Yesterday's action makes me think of my 'touch and go' post. But we can not ignore the obvious, earnings are in place, and look really good for some (ie INTC) and okay for others (ie BAC, C).
The market can retest the 320SMA, as it comes down from its overbought condition.
Regardless of the market action, I purchases some IBM on the decline and going to purchase INTC soon. The earnings thesis for multi-nationals with disturbingly low PEs are very much intact, and the technicals set-ups are too interesting to ignore.
I pointed out the other day that INTC's weekly set up is primed to break from its long-term negative trend line. Now the daily chart is indicating a support around current levels. (I would look to sell around 30)
Now for IBM. Everyone here keeps hearing me bring up IBM, and I present the fundamental case far too many times to bring it up again. (just type in IBM in the search box, and you will see my posts) Technically, IBM is in a situation where it has consolidated earnings beat after earnings beat for 9 months. That is 3 quarters of consolidation. With IBM projecting 15% eps growth yr-over-yr to 2015, and the street to look at next year's estimated eps, I think we get a pop up after this massive consolidation.
The last few quarters IBM declined after good quarters, and if the market is in a bipolar thought of negativity, it could decline after earnings. But with a report that even produces expected numbers, the stock will still be inexpensive.
(Remember, with a trailing PE of 12, year end EPS of 11.27 we have a price of 135. But I think they do more like 11.50, and if 2011 eps are taken into account in the 2nd half, the trailing PE should expand to 13-14.)