Despite a better-than-expected jobs report and the strong open of Groupon's (GRPN) initial public offering, we have some bumpy action. The biggest negative is that the worries in Europe are slowly shifting to Italy, and Greece is still not fully resolved.
We are a bit technically overbought and have resistance to deal with, which is bringing in the sellers as the market struggles.
Breadth is turning very poor as the high correlation between stocks continues. Stocks are moving as a group -- it's a losing proposition to battle a weak day by trying to pick better-performing stocks. There are few safe havens and little leadership.
I've been a net seller so far, but I'm interested in buying on a pullback. We need the correction at this point, and conditions appear to favor it.
Web.com (WWWW), which I've been tracking for a while, had a solid earnings report and raised guidance. That is definitely one that I'll be looking to accumulate on pullbacks. I'm also interested in some small oils, like Newpark Resources (NR) and Magnum Hunter Resources (MHR), and I'll add to them as they develop.
Overall, it looks like a day of consolidation and I'm not in a big rush to bottom fish. I am optimistic that there are going to be some good setups developing, but it will take time.
