We've needed some dull, flat-to-down action to help this market consolidate gains and we sure got it today. It was a very slow day with a lot of mild selling on lighter volume. There wasn't any panic, but some of the extended names such as CMG, JDSU and NFLX saw some decent-sized pullbacks. I was actually starting to wonder if there really were stocks that never go down. I guess I don't have to worry about that too much anymore.
Looking at the bigger picture, the selling today was hardly noticeable. It was just a very minor blip within a massive up trend. The big question is whether this is the start of something more severe or just a pause that will refresh and rejuvenate the buyers. The buyers have consistently come roaring back ever since the bottom in March 2009, so it's a bit too early to think they are now suddenly going to change their tune.
At this juncture, there is no reason to believe that the end of the uptrend is upon us. That said, keep in mind the fact that tops are processes that play out over time. A day like today could be the very first step in a change in market character, but we will need a number of failed bounces and some lower lows before it makes sense to shift to a more bearish stance.
The bears did put a few points on the board today, but the bulls have such a huge cushion that it is going to take a lot more before the bears can be taken even a little seriously. So far, this is nothing more than a well-deserved rest.