The good news: The bears failed to build on yesterday's selloff. The bad news: The bulls didn't manage much of a rebound.
For the past few months, this market has typically bounced back immediately from any selling, but today there wasn't any big rush to buy the dip. We didn't even have much buying interest in the final hour, which is also a bit of a change. It wasn't bad action, but it wasn't the lively dip-buying we'd grown used to.
The FOMC announcement did nothing to liven up the action. There weren't any notable changes in interest-rate policy. Usually we have some sort of reaction, but today we barely had a pulse on the news.
We have a few earnings reports after the close: BIDU, V, GMCR and FSLR will likely garner the most attention, but they probably won't influence the broad market very much.
The sovereign-debt issues in Europe are likely to continue to bubble up. If market players start looking harder for reasons to sell, those issues will offer good excuses. It is a mistake to just dismiss them out of hand, with the justification that the earnings reports are quite good. The market is trying to figure out its next move, and it will decide which of these news items will be the most relevant. Let the price action be your guide. The market will tell us what news is the most important, not the other way around.
The bulls still have the edge, but there are cracks in this uptrend.