After 9 up days for the Nasdaq, it is time for the market to rest and some correction. 9 up days in a row is very rare and my stats say there should be a 2 to 3% pullback. I sold DXO, URZ, EMC and ADRE. The solar companies held up really well today, so I am holding my position in ESLR with a tight stop.

My plan for the rest of the month is to look for better setups. If the market is sloppy for another day or two I might be tempted to try a short position here. The 9 day rally has changed the market mood back to speculation so unless some really bad economic news comes out this week, I think we will head higher after the market digests the huge gains of last week.

Weeks like the last one are very frustrating to people who have an opinion about the market and ignore what the market is doing. That is why having a game plan and being able to admit that you are wrong are skills you need to make money in the market. I completely missed the boat with AMZN this week because I had an opinion and did not follow my rules.

I had a good week. But it could have been a great week if I had choosen to go fully invested. I am still very defensive here and 75% in cash. The market is very overbought here. I am looking to buy the pullback over the next week or two.

DXO had a great week. I am still long and keeping a tight stop on the trade so I don’t give back the profit.

I sold AHD on Friday. With the strength in oil, it should be flying. It did not, so I took the small profit and will wait for more clues.

URZ had a great week. I think it will consolidate here for a few days and then give a clue about the direction of the next move. I am keeping a tight stop loss on this trade.

One of my favorite chart patterns is to buy the first pullback from a new intermediate term high. I bought MDRX for this reason and it bounced perfectly. Unfortunately, it gapped lower on Friday and spent the rest of the day recovering. I think they are reporting earnings on Monday. So, this was the reason for me to take a small profit and to see what happens. Sometimes gap downs are just the marketmakers playing games to wash people out of their positions. Other times it means someone knows something and they want out of the stock bad. That’s why I got out. It is not worth the risk. Best case here for MDRX is that the earnings report is a non-event and the stock consolidates here for a few days. If it can do that, I will consider getting back in.

ESLR has turned out to be a dog. I am down about 5% in it. The chart pattern could go either way here so I am probably going to take the loss on Monday and wait for the solar group to give me more clues.

This week was tough. The market was under pressure. I am still very defensive here and 75% in cash.



Crude Oil had solid selling all week. I think it can bounce here for a few days so I bought DXO. I am giving it the 3 day rule. If the trade isn’t profitable within 3 days. It’s gone.



Pure speculation here. When AHD moves, it flys. It has pulled back to support so let’s see if it will take off again.

Back in URZ too. Uranium related stocks really move. URZ pulled back to support so I’m giving it a shot here. I am starting to track a few other uranium stocks now.

Monday’s market was sloppy. AMZN was weak when the market recovered in the afternoon, so I took the profit. $84 is very close to the 62% fibonacci retracement and if the market is going to get weak, I don’t want to hold AMZN. ESLR gave back most of Friday’s gain so it is on a short leash here.

An unexpected upside move from URZ today. I couldn’t find any news to explain it, but the volume was impressive. So, what do you do when a stock goes vertical? I started to get nervous this afternoon when it was up 20% then it went parabolic and was up 40% over the next hour. Then it started 5 to 10% swings over 15 minutes or so and I decided to bail. My new rule is to get very defensive when a stock makes a huge intraday move and starts to back off by more than 10%. URZ closed at $2.13 and I sold at $1.99. Who knows what Monday will bring. I have to think about where I would get back in URZ. You need special rules when stocks go parabolic.

I sold TAN today and took a small loss because the chart pattern is looking like it could go either way. AKNS sold off today which is one of my favorites. ESLR was up on nice volume, so I am going to ride it for one or more days.

Another good day for AMZN. It did a nice early morning fakeout and then consolidated for a bit which I take as bullish. We are getting close to $85 which could bring out some sellers. I like how volume has increased 3 days in a row here. I am going to give AMZN a little breathing room on Monday to see how it behaves. I do not want to see it retrace more than 1/2 of todays range or get below $82 on Monday.

Preserving capital is a strategy The sell off of the past week did a lot of damage. I think the next month will be choppy and to the downside. So, any long positions here need to be on a tight leash with a close stop loss.

We touched the lower edge of the bollinger bands on a lot of stocks. I think we could recover for a few days and that is why I am back in AMZN today. Not that confident that the worst is over but it can retrace 38% to 50% of the decline and that is worth going after.


I am taking a position in TAN here. It has been hard hit and I am looking for a few days of recovery.

I have been reading good things about Evergreen Solar and it pulled back nicely into the base. So, I am long here with a close stop loss.

I am keeping an eye on AFCE here. They are the parent company of Popeye’s Fried Chicken which is my favorite. The stock is very choppy and it could get interesting if it can get above $7.20. On 6/19/09 it got close to breaking out on pretty good volume. Then the market got weak and it has consolidated. The lesson here is that buying a breakout when the market is extended or getting weaker is not worth it.



Last week was frustrating. AKNS finally broke out and made a nice run but pulled back a lot on Friday so I took the profit. It needs some time to rest this week and then we’ll see if the new trend will continue.

AMZN did a fakeout this week. It traded very choppy all week. The outside price bar on Wednesday was a clue something wasn’t right. So I set my stop very tight and got stopped out. The lesson here is the majority of stocks are dependent on the direction of the whole market. When the overall market gets sloppy, most chart patterns will follow the market. AMZN needs to correct this week.

DXO had a good week. I was in and am now sitting on the sidelines. No opinion here on oil.

I got stopped out of DGP and it looks like it needs to correct here. URZ has pulled back to the breakout. So, I am waiting for a better chart patterns on both of these.

I like AMZN here and bought some on Friday. I think it can run to 90 if the market is flat to up this week.



What about Oil?
DXO looks like it is ready to breakout again. I was tempted to buy some on Friday but the afternoon trading looked weak. It has been consolidating for 5 days. I did not like the sharp spike down on Wednesday to 4.06 so I would rather buy above 4.59 on good volume instead of risking a re-test of the 4.06 area this week.

Welcome to the MarketWatcher blog. I will be posting my thoughts on the markets and trends.

The big trends I am playing this year are: international etf’s, solar, water, oil, uranium, and metals. I will explain my thinking on these trends and how I plan on playing them.

I am nervous about the markets up here and am mostly in cash. Here are some of the things that I am following this week.

Solar ETF (TAN)…
Looks like it needs a rest here.