We had a mild bout of profit-taking today, but the market has been so strong lately, it was about the worst day in over three weeks. It is the first time that this month that the S&P 500 and Nasdaq have had two negative days in a row. We were due for some sort of pullback, but overall the bears didn't manage to do too much damage.
The action under the surface was worse than indicated by the major market indices. We had only minor losses in the indices, but breadth was solidly negative, and some of the recent momentum plays took some hits. Probably the biggest negative was that technology and banking led to the downside.
Volume picked up on the Nasdaq, and that gives us a technical distribution day there, but AAPL prevented any really pullback. Also, the S&P 500 held above 1130, which is the key technical level that everyone is watching there.
It was obviously a weak day, but in the bigger scheme of things, it looks like nothing more than just some healthy consolidation. The damage under the surface is a bit worrisome, but it is still the bull's game to lose at this point.
We'll see how things shake out tomorrow. The bears won't hesitate for long if they are going to finally do something. The action today didn't advance their cause much at all.
long AAPL
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