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Market Preview: Easy Money Made

Updated from 7:04 p.m. ET to include additional information about after-hours action, Family Dollar's quarterly report.

NEW YORK ( TheStreet) -- It seems bulls and bears alike would welcome a pullback at this point.

A little slippage in consumer confidence tripped up U.S. stocks on Tuesday but it's hard to complain about such polite selling after Monday's strong rally.

Still, as winter gives way to spring, the inevitable comparisons with last year's market action are cropping up. While 2011 didn't start out as well as 2012 has, the similarities are undeniable. Sameer Samana, international investment strategist at Wells Fargo, listed a few in commentary released after market close, most notably the winding down of QE2 in 2011 vs. Operation Twist this year and the low volatility trading environment.

"All these factors give us a sense of déjà vu, as the current rally has barely paused within its uptrend," Samana wrote. "This suggests an environment where, in the short term, the easy money has probably been made and the bulk of the rally is probably behind us. We this as an opportunity for traders to trim positions and take profits. As the market works off its overbought condition, we believe a better opportunity to increase equity exposure will present itself."

Binky Chadha, chief global strategist at Deutsche Bank, is also of the mind that stocks need to go down some before making another move higher. He said Tuesday that stocks are likely due for a 3-5% decline "but also a significant further rally."

"The magnitude, breadth and duration of the rally across risk assets and the corresponding collapse in volatility have taken market participants by surprise," he wrote. "Many observers have expressed concerns that it represents a quick reversion to complacency, yet another manifestation of the bipolar risk-on/risk-off behavior typical of the last few years."

Federal Reserve Chairman Ben Bernanke juiced stocks on Monday by hinting that more stimulus may be necessary to combat the problem of long-term unemployment but there's still plenty of skepticism out there that QE3 will come to pass, so it's just prudent to prep a portfolio for what happens when/if the risk-on trade ends.

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