The stock market has once again entered a period of consolidation as investors wait for the results of the most important legislative decision of the year. The fight to repeal and replace Obamacare has taken the spotlight as Congress debates the passage of legislation that would eliminate its most burdensome aspects for businesses and individual taxpayers alike.

Internally, the NYSE broad market has been unsettled for the last several days after a period of relative calm in the months following the U.S. presidential election. There have been more than 40 stocks making new 52-week lows on a daily basis since last week. This makes almost two weeks that the number of daily new lows has exceeded 40, which reflects an increase in internal selling pressure. Most of that selling pressure is coming from consumer/retail stocks, bond funds and, increasingly, energy stocks. 

The extremity of internal selling pressure isn’t yet great enough to cause any major concerns about the strength of the stock market’s intermediate-term uptrend. If the new lows don’t soon diminish, however, it could eventually cause problems for the interim trend as internal weakness spreads from the above-mentioned sectors to the broader market.

Following is a graph of the daily cumulative NYSE new highs-new lows. It’s telling that for the first time since the Nov. 9 election, the highs-lows have stalled out. And while the trend is still technically up for the high-lows, that trend could be broken if the new lows continue to expand in the next couple of weeks.

It’s clear that the honeymoon phase of President Trump’s election is over as investors aren’t giving a free ride to the stock market until he delivers on some of his campaign promises. The most critical of these promises concerns the proposed overhaul of the Patient Protection and Affordable Care Act (a.k.a. Obamacare). The mainstream news media are in full swing right now with negative stories which undermine the Congress’ effort at eliminating the onerous taxes surrounding Obamacare. The tantalizing prospect of having the bill’s individual and employer mandates (which forces individuals to purchase health care or else pay a steep penalty) repealed is one big reason why the middle class turned out in droves to elect Trump.