The reasons I posted earlier via the 'curious' post I believe still stand, except I also think there is a lack of positive catalysts in the short-term. Anyone of the 4 reasons pretty much acted as an excuse to sell.
The 'ace-in-the-whole positive catalyst the market had was earnings. The reports were/are strong, and most stocks acted accordingly. But now the reports are started to fade, and its back to the assumed 'top-down' economic affect to the market. I think the top-down approach is complete and utter bullshit because so many market players use it incorrectly. (Does anyone really think they can do an accurate top-down economic assessment of the US, EU, BRIC and RoW, with a combined total of some +30trillion GDP? If anyone thinks they can, I will know who is a bullshitter :)
US economic data matters, but what really matters is global economic data and GLOBAL GDP growth because so many of our companies get their revenue and earnings abroad.
The fact remains the BRIC countries are trying to slow down due to inflation, but their affect is not at all pressing. The BRIC index has been pretty flat. (Notice how much our markets correlate to the BRIC markets, adds to the above comment about Global GDP that matters.)
There are definitely some indications within certain indexes that merit reason for concern. The retail, materials, aerospace, defense and semis that have acted like crap. (The canary in the coal mine being the semis which was in a negative trend for some time, and something I highlighted.)
Throughout this decline, I think opportunities have emerged, and I have been using the heavy cash position I have built. The market multiple is not over-extended by any means, especially with two quarters worth of earnings under its belt. I have purchased DIS, AXP, IBM and AAPL. And am patiently waiting to trade GOOG, POT, ATI, more IBM, AXP and re-adjust the DIS options to my equivalent number but via the Jan 2012 37 strike.
POT - Looks really good here, and almost over sold. Looking for an initial entry, and adding more between 54-55.