The market was set up for an oversold bounce, and we even had the potential for President Obama's speech to serve as a positive catalyst, but the buying was very lackluster.
We managed some green today and the Nasdaq outperformed, but breadth was only 2,875 gainers to 2,650 decliners. Banks were the biggest problem, but there wasn't any big rush by dip buyers to load up on them.
We are still oversold and have the potential for a better bounce attempt tomorrow, but it's troubling that the bulls couldn't manage better energy today. So far the two major earnings reports have been disappointing, with both AA and JPM being sold off on their reports. GOOG reports tomorrow after the bell and we'll have a better test to see what sort of sentiment is likely to prevail during earnings season. There usually is some sort of theme that develops, such as "buy the bad news" or "gap and reverse." We haven't had enough reports to establish a clear theme yet, but Google will be important in that regard.
For the eleventh straight day, the market was unable to close near the highs of the day. That is the sort of action you expect to see in a downtrend. We are very lucky that this consistent intraday selling pressure has not resulted in more aggressive downside so far.