This hot market is off to a slightly lower open this morning, though mild consolidation appears to still be the recurring theme after each thrust higher. The biotechnology stocks, such as GILD MDVN ONXX REGN are showing early strength, keeping in mind that sector has been a leader throughout 2012. Beyond the biotechs, some of the consumer staples are seeing a bid while the materials are down on likely profit-taking.
Seeing a cooling off period following a powerful breakout is not a bearish event on its face. Of course, the key is to avoid complacency and focus on whether the market still permits some breakout plays to occur during the consolidation, in addition to other stocks basing tightly rather than suffer heavy distribution.
As long as that remains the case, resisting the urge to call a top or look at the bear case is going to be my main focus.
