There just aren’t any surprises anymore on Wall Street! Calling this market for us intermediate-term market players has just been a breeze lately. Back in April, we counted a few too many distribution days and knew that cash was the place to be. Then last week, we watched the market follow-through and confirm its rally attempt, but there hasn’t been anything to buy, so again we are in cash. Now, it’s not that shocking to see the indices down today on heavier trade than yesterday…yes, a distribution day is in the works as I write this around 12:30
p.m. ET.

As I manage money, I tell clients and myself that the primary goal is to make profits. Of course that is why we are all in the game. But a close second is to preserve capital. Over
my 13+ years of investing, I have yet to come across a better investment philosophy
than the one we are all sharing. Over the past couple of years, I have been excited at how relatively easy it has been to stay away from the choppy trading that has been prevalent in the market. I’ll admit that it has been boring, and patience has been important, but aside from that, applying the rules has not been too difficult when we remove the emotion.

Recently, a few stocks have been moving higher and a few have even been hitting 52-week highs. But most stocks have not offered the low-risk entry, or produced qualifying fundamentals for us to move into them. While the market chops around, this will inevitably keep us in cash and protected from the unpredictable swings that have been occurring.

Recent success story Christopher Banks
( CHBS | Quote | Chart | News | PowerRating) was seen running into trouble today. The stock and retail group has been one of our leaders. It will be interesting to see how the stock closes. If the pullback continues, I will be watching the stock around 36 which is where it will bump up against its 50-day moving average, a key level of institutional support.

Peet’s Coffee
( PEET | Quote | Chart | News | PowerRating) ripped through a pivot at 16.70 on Friday, only to run into trouble at its 52-week high, an apparent level of resistance. ROE is a bit light at 6%, but there haven’t been very many other stocks to watch.

America's Carmart
( CRMT | Quote | Chart | News | PowerRating) moved out of a very short consolidation on Wednesday. I watched the move as it occurred and there was quite a bit of whipsaw involved,
even though the stock looks like it made a clean break. Today, it is pulling back towards its pivot.

Although I do admit that each day of uncertainty that passes allows more and more bases to be built behind the scenes.
Autozone ( AZO | Quote | Chart | News | PowerRating) reports after today’s close and is working through a multi-month base.
Websense ( WBSN | Quote | Chart | News | PowerRating) has formed a massive base that began in March
2000. Recent mover Anthem ( ATH | Quote | Chart | News | PowerRating) has paused and is working on the fourth week of a new base. Even the homebuilders have stopped going up and have begun bases of their own. Many other stocks are taking advantage of the rough environment, in order to set up and explode when investors are least expecting the move.

Thus far, anything that has attempted a move higher has been met with a lot of volatility since very little is doing so. This remains the time to be patient and enjoy the ease of interpreting the signs that place your portfolio in cash. If you are just learning to invest, or simply trying to improve on your skills, be sure to take full advantage of the resources at your fingertips.
For a few bucks a month, there is my trading service through Tradingmarkets.com which now includes a Message Board that I intend to visit frequently.
Also visit my website, truecapitalmanagement.com. I believe these tools can not only help see us through uncertain trading environments, but increase our profitability when the time comes.

Until Thursday,

Tim