INTC and JPM have not been able to propel the market higher. INTC's earnings were well above analysts' expectations, but below the whisper number. JPM had good bottom line growth, but loan loss reserves are a concern. The Dow has broken down below its short term trendline from the 12/31/09 low, but as long as it remains above support at 10516.70, we cannot conclude with any certainty that the top is in. Of course, the deeper this current pullback, the lower expected rally targets will be should the rally continue next week. The Qs really need to hold above 45.53 or there will be trouble, but for now the pattern in the Qs still suggests higher prices, although the lack of follow-through puts a damper on upside expectations.
High volume today may not mean anything with options expiration. The selling could very well be attributed to options expiration as well. Keep in mind that we have a 3 day weekend coming up, and the Tuesday following such weekends tends to be bullish. Also, keep in mind that if we pullback into the January 20 turn date, it could be a bullish omen.
My biggest concern is that traders will want to jump the gun and try to short this top before it really tops. When it does top we'll know it soon enough.
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