It was another rollercoaster ride today with the dip buyers jumping on the open, followed by a boost from President Obama on hints of a tax deal and then weakness at the finish on a downgrade of Portuguese debt by Standard & Poor's. The indices managed to push into positive territory for a little while, but breadth was poor all day.
We had some very narrow leadership from the likes of NFLX, DECK, RIMM and CMG. Gold and silver were the leaders. That isn't a particularly great combination, but it did serve to cover up some of the damage that is being done to the average stock.
Weakness in technology stocks is the biggest negative I see right now.
What is holding us up is the generally good economic data and some good fundamentals in individual stocks, but the bulls are doing battle with the bad news out of Europe and it is taking a toll. The problem is, if Europe really is going down the tubes, our upbeat economic reports aren't going to matter for long.
The good news is that the S&P 500 is still in the trading range of 1175 to 1200. However, each time we test 1175, the more likely it is to fail. It held again today, but if we test again in the next day or two, I'm concerned it will trigger some stops and cause a fast spike to the downside.