A number of factors that merit concern have coalesced in recent weeks.
First, consider the overall context. We are now almost 5 years into one of the greatest bull markets in history. Bull markets don't last forever. According to Jim Stack of Investech, the average bull market since 1932 lasts 3.8 years. The odds are that we are in the later stages of this one.
Second, some of the leading stocks are starting to roll over. Consider Tesla (NASDAQ:TSLA), LinkedIn (NYSE:LNKD) and Facebook (NASDAQ:FB). Each of these stocks has been a monster this year, minting money for shareholders. However, 3rd quarter earnings from all three were met with selling. High-flyer Tesla has lost almost 25% since reporting earnings Tuesday. The reaction to Facebook's spectacular quarter was disappointing.
Third, Twitter's (NYSE:TWTR) stock has been sold heavily in the wake of its highly anticipated IPO. It closed at $41.72 on Friday, well below its $45.10 open on Thursday morning. This may be another tell that momentum is waning.
Fourth, last week's Fed Decision was met with a "sell the news" reaction. The Fed elected to continue its current pace of Quantitative Easing [QE], which is what the market wants, but stocks have been weak since that announcement two Wednesdays ago at 2pm EST.
Finally, Thursday's selloff was broad and deep, with NYSE Composite Volume over 4 billion shares for the first time in quite a while. It is worth noting that this took place on the day of Twitter's IPO. A follow through day of heavy selling in the next week or so would further confirm the beginning of at least a correction.
In sum, most of the news has been good in recent weeks, but stocks have reacted poorly, suggesting that it may all be priced in at this point. If an accommodative Fed, solid earnings and a blockbuster IPO can't propel this market higher, what will?