Up and down...all on light volume again. Stocks rose at 10 a.m. ET as May New Home Sales came in much better than expected. That makes sense.
We dropped about 1 p.m. ET for reasons that are somewhat mysterious and may not be all that important.
It seemed to start in the energy space. Energy stocks, as I have emphasized for days, have been the market leaders in June. The S&P Energy Sector is up 4.5 percent this month, number one among the 10 S&P Sectors.
Then oil dropped midday. Oil stocks, which had begun weakening earlier in the morning, began to sell off quickly. E&P companies like EOG Resources (EOG)...that have turned into momentum stocks...quickly began to sell off on heavy volume (note I said HEAVY volume).
Why the change in energy? That's where it gets murky. Vague reports out of Syria and Iraq and Ukraine seemed to make little sense.
Regardless: Energy is a major momentum group right now. So other momentum groups...like semiconductors and airlines also began to reverse as Energy reversed.
What's all this mean? We are overbought on a short-term basis in those "momentum" groups, so rather than exhaust yourself trying to find a reason (Sunni militants are in control of a refinery! Wait...they're not in control! A Ukraine helicopter is down!), you should just read the tape.
No one wants to sell but there are fewer who might want to buy at these levels.
So even the tiniest of air pockets (and this is pretty tiny) causes people to take profits in the momentum names, because so many people are on the same side of the boat.