Earnings from IBM (IBM) and Intel (INTC) were not well received and that set the stage for today's action. We did bounce off the intraday lows a number of times, but the strength fizzled and we ended up closing poorly. Breadth improved off the very low levels early in the day but was still around 2-to-1 negative. All major sectors except for oil services were in the red.
I've been concerned that after the big run up in the first quarter of the year that the bar was going to be set too high for earnings. So far, that has been the case and it is continuing tonight as Qualcomm (QCOM), F5 Networks (FFIV) and American Express (AXP) are down initially on decent reports. These aren't bad reports, but they aren't strong enough to attract new interest. Market players are more concerned about protecting gains than they are about missing further upside.
On the positive side of the ledger, the market held well above Tuesday's lows and there were signs of dip-buying here and there, and there weren't any signs of panic selling. Intuitive Surgical (ISRG), Priceline (PCLN), Chipotle (CMG), United Rentals (URI), Starbucks (SBUX) and Amazon (AMZN) attracted interest. Any weakness was more a function of lack of energy than active dumping.
Tomorrow we have weekly unemployment claims and the Spanish bond auction, which will set the early tone, but I'm finding the technical action worrisome and I'm taking a more bearish stance. There are still some good long trades to be had and I'm not seeing many individual short plays, so I'm not going to be too negative. But I'm mentally prepared for some downside and will look to press if it develops.
Have a good evening. I'll see you tomorrow.
More from James "Rev Shark" DePorre: