After the big cap technology stocks blasted the Nasdaq and Nasdaq 100 higher on Monday, there is some consolidation taking place. Early strength in the FATMAAN names was sold and the strong rotational action that was taking place yesterday has come to a stop.
Breadth is running around 2 gainers for every 5 incliners, and the number of stocks hitting new 12-month highs has dropped to under 150. This is primarily a reflection of weaker small-cap action in the Russell 2000 ETF (IWM) .
Quite a few of my core positions have had great runs recently and need rest and consolidation. I have made some reductions and will be looking to add incrementally as they develop from here.
There is selling pressure out there but that is healthy and will help to give us some better entry points. The easy mistake to make is to act like the market is going to completely collapse. That is not likely and those stocks with good fundamentals and strong charts will withstand the pressure better than others.