Despite Thursday's lack of follow-through, the intermediate trend is still up. However, the pronounced lack of momentum indicated the pessimists — or perhaps the fearful — clearly outnumbered the optimists.

To me, almost everything except for the biotech group appears overbought. And the energy sector is the most expensive, with Bespoke noting, "About half of the stocks in the sector are now more than 50% above their 52-week lows, and four are more than 100% above their lows."

Jeff Saut of Raymond James pointed out that the McClellan Report says, "Bearish for short and intermediate trading styles, bullish long term."

I agree in that I favor the "upside," but not now. Buy on pullbacks, not high-P/E advances.