After the third day of runaway action in some big-cap momentum names, the bulls were a bit too overconfident, leading to a sharp reversal. AAPL, which was up more than $11 per share at one point, closed just over $2 higher to $413.80 after briefly going negative.
The narrow strength in a few big names has helped to drive up the indices recently but has covered up some far less positive action in financials, commodities and small-caps. New 12-month lows have been outrunning new highs for the last few days, which usually doesn't occur if strength is broad. The fact that only 85 stocks hit new highs today confirms that there isn't any real leadership.
Given that a number of stocks have traded almost straight up for more than a week, we shouldn't be too surprised to see profit taking with the very important Fed meeting coming tomorrow. You have to at least consider the chances of a little sell-the-news reaction, especially with substantial overhead resistance nearby.
