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It's all in the volume: sell offs are grim, get less bearish

A trader on the floor of the New York Stock Exchange.
Getty Images
A trader on the floor of the New York Stock Exchange.

S&P futures dropped while Tom Demark, a famous technical analyst, was on our air, saying the next couple days were critical, and that if stocks moved down in the next couple days they would continue to fall no matter what the jobs report said on Friday.

Maybe. It was widely noted Mr. Demark is selling market timing seminars, one of which he is doing today in New York.

Yesterday's volume of nearly 4.2 billion shares was heavy but not as heavy as Monday's selloff; breadth was 3 to 1 advancing to declining stocks, good but not great.

(Read more: Bonds beating stocks in 2014...so far)

In other words, the selloffs are coming on greater breadth and volume than the rallies. We need to see that moderate.

In Japan, the Nikkei rose 1.2 percent, fueled by decent earnings from Toyota and Panasonic.

(Read more: What Wall Street's looking for in Disney earnings)

Another issue impacting the market are perceptions of Fed tapering. Traders will be listening for any comment on whether the taper will continue. Fed hawk Charles Plosser (Philadelphia Fed) and moderate Dennis Lockhart (Atlanta Fed,non-voting member) are speaking today. Yesterday Chicago Fed President Charles Evens said it would take a "high hurdle" for the Fed to move away from tapering, one reason the rally was rather muted.

At least bullishness is moderating: the II investment survey showed bulls at 45.9 percent, down from 52.1 percent last week and a 6-year high of 61.6 on December 31. Those bulls went mostly into the Correction camp; Bears have gone to 17.4 from 15.3 percent.

Bottom line: bearish levels are still not very high.

(Read more: Marc Faber: Here's how much I want stocks to fall)

Elsewhere:

1)The MMM buyback is huge, one of the biggest ever: $12 billion out of a market cap of $84 billion is about 14 percent of the stock outstanding.

2) We'll get Twitter's first earnings report as a public company after the close. What a ride for them: pricing at $26, opened at $45.10, and got as high as $74 in December. Expect them to report their earnings...on Twitter first (@TwitterIR).

3) Several biotech-type initial public offerings (IPOs) open at the Nasdaq today:

· Auspex Pharmaceuticals (ASPX), a clinical-stage biotech developing treatments for orphan diseases. Headquarters: San Diego, CA.

· Biocept (BIOC), which develops and markets cancer diagnostic tests.Headquarters: San Diego, CA.

· Genocea Biosciences (GNCA), which develops novel vaccines for infectious diseases through T cell immune responses. Headquarters:Cambridge, MA.

· uniQure (QURE), a biotech developing gene therapies for the treatment of orphan diseases. Headquarters: Amsterdam, Netherlands

(Read more: Selloff means big discounts: JPM's Lee)

By CNBC's Bob Pisani

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  • A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

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