To kick off the week, we said we’d let the SPX work itself out at 2009 highs while we focus on individual equities.   So far, we haven’t missed much as the SPX has closed relatively flat for 2 days off best levels of day, while 2 biotech stocks we said should be on top of your trading list heading into the week have been 20%+ gainers.   The Bears will probably say the market couldn’t break Mondays highs with 3 positive headlines ( CCI/ Home prices/ Bernanke ), but as far as we’re concerned, these items were pretty well cooked into this recent rally.  The only thing that weighted on the market was a sell off in energy/ crude that took the SPX tape down with it.   This could happen on any day and is hardly an indication of where the market is going.   The rally is in intact and any weakening we're seeing this week is more a sign of the end of summer times.  The Bears are getting all riled up at the wrong time.  This market should go nowhere till post Labor day if this lightly attended market is any indication.   We’d use any surprising sell off in individual liked equities as a chance to add that position either for a quick trade or a longer hold.   

As far as those equities on our list, besides the biotech HGSI, BCRX  moves this week,  most of the stocks we’re following closely are holding up well and everyday there is one or two making new highs.eg. STEC CTSH SXCI EMS  today from our list.   Tomorrow, it might be a few others as been the case.   Off hand, we’d say there is a core of about 15 stocks that we’ve bolded  most recently in Journal that are performing just right and that's where our focus is.

We don’t expect conviction to show up on buy or sell side.  If we do a up move like today again, we would not put too much into it as profit taking will show up again and we’d use exaggerated weakness to pick up those most affected from our core.