GIDDY HAINSEY

Markets open higher with the BIG CAPS leading the way. Notable action in the 10 year Bond as it trades with a 4.75% yield on the heels of the tame inflation report.

Market internals not so great as 900 more winners than losers on NYSE and 450 more winners than losers on the NAZ.

Sector outperformers include semis, GOOG, KLAC, arilines, tech and financials; worst groups are metals, oils, drugs and trannies.

The IWM, one of my proxies for real market direction, is up 15 cents as I type, so a little less optimism for the small caps. The QQQQ was up near 40.4 but has already lost some of those gains. The SMH is acting best, up over 1.5% and threatening the $35 level.

I am in no rush to buy this pullback as the internals look pretty crummy in light of the futures action. If I start to see improvement there, then yes, buy the pullback probably becomes the trade of the day.