Tuesday’s selling suggests further weakness in the short-term (next 1-2 days). A potential pullback in the market would be welcomed, provided that new buy setups develop.

$CDK was added to the model portfolio on Monday, and although the price action failed to follow through, it did set a new 52-week closing high on heavier than average volume. The hourly chart still looks good and a move above Monday’s high could generate some buying interest.

According to our stats, the Nasdaq Composite set a new 52-week closing high last Friday on the lightest volume it has seen in 40 sessions. Also, last week’s price range produced an NR7 bar, which indicates a dry up in price volatility.

Distribution in the market forces our market timing system to “neutral” mode for the first time since the current buy signal triggered on February 13. However, one stock we still like as a potential core trade is $Z, due to its strong earnings and current base that is holding at support from the 10 and 40-week MAs.

The weekly chart below shows the bullish action in $LIT since last summer, where it formed a double bottom like pattern and attacked the weekly downtrend line. With support holding at $12, $LIT produced a higher swing low and recently broke out above the prior swing high.

Yesterday, we locked in solid gains on quite a few of our open positions, as stock market has begun showing signs of a possible correction in the coming weeks. Facebook and SolarCity were gainers of more than 40% each.

We sold partial share size from our $TAN trade, which we bought on Feb. 14, for a gain of +21%. We remain long partial position size and will continue to ride the profits as long as the trend remains bullish.

The daily chart of $KORS has formed a tight trading range the past three days right at the 10-day MA. A move above the two-day high looks to be a low risk entry point with a fairly tight stop just below the four day low.

$UNG appears to have found support at the 20-day EMA after a false breakout above $27 a few weeks ago. Volume has declined during the consolidation, which is a good sign (quiet/tight action should be confirmed by quiet or lighter volume).

$GLDX is consolidating in a tight range above the rising 20-day EMA after breaking out above the 200-day MA on heavy volume. We are looking for $GLDX to resume its uptrend after three to four weeks of sideways action.