For the first time in about 14 trading sessions, the bears managed to notch a fairly clear victory. We did bounce back in the final hour. Volume was light and the point loss wasn't anything major, but in view of the very strong earnings news, the bears did manage to score some points.
Last night, market players could hardly contain their giddiness over the reports from AAPL and TXN. There was even more good news this morning from the likes of CAT and CMA, but the sell-the-news reaction dominated.
Sell-the-news has been the theme so far for third-quarter earnings, but it hasn't caused too much damage. The problem for the bulls today was the dollar finally bounced, which caused weakness in oil and commodity-related shares, and we were technically overbought enough for some profit-taking to kick in.
The bigger picture still remains very positive. The uptrend is intact, and momentum has barely slowed. In fact, it can be argued that today's action is positive consolidation that helps to build a stronger base that will support further upside.
So give the bears a little credit for finally showing a little energy, but they are still way behind and will need quite a few more days like this before they can be taken seriously....