Typically, light-volume pullbacks within an uptrend are healthy. They allow stocks to migrate into stronger hands as short-term holders take profits, and they allow big funds to accumulate at lower prices. As long as the pullbacks are contained, they make it more likely for further upside.
That is what saw today. But a late spike caught the bears leaning the wrong way after several failed intraday bounces. We had a decent recovery and ended up with just mild losses. The perma-bulls love that the bears are so inept, but it makes for dangerous conditions when there is so little fear.
Disinterest is what really kills a market, and you have to wonder what is going on as volume on the NYSE continues to descend to levels not seen in a very long time.
You would think that a market that has been trending up for weeks and is close to its highs would be generating increased interest, but we seem to be going in the opposite direction, which makes the persistent bids seem more manipulative than indicative of real accumulation.
Ultimately, price action is what matters and it is hard to argue with a market that closed the way this one did today. We had a number of failed bounces and looked ripe for the weak finish, but the dip-buyers wouldn't stand for it. I suspect that the computers had something to do with the energetic close, but it just goes to show that you really have to be careful fighting this market.