2-27-12 after the close

The distribution count has dropped to 2 after the NASDAQ closed more than 6% obove the 1/21 distribution day close.

Next week we will enter a Power Trend if we do not enter a steep decline before then. We will need to close below the 50-day to prevent a Power Trend. The market has been extended for quite a while and it is anyone's guess how long this can continue. Power Trends are designed to get us through a pull back with at least 30% invested. Strong market rallies like we have witnessed can lead to further upside once a pull back occurs. It doesn't always work out this way of course.

I suspect that the FED has found a back door QE through Europe. European banks can borrow USD at near zero rates and in infinite or at least large quantities. QE in the US is not getting a positive response, so QEe it is for now! I suspect the results are similar, tight money is now freer to buy government bonds as well as perhaps the equity markets.

My largest and best performing position is KORS. It looks like it might set up a high-tight flag. If so I will get aggressive on a breakout. I already own more than a full position. Bill O'Neil suggests a high-tight flag should go up 100% in less than 8 weeks, form a 3-week or so tight consolidation and then the buy point is when the stock breaks above the pattern. KORS has not gone up 100%, but close enough. There are many examples of stocks that go up a bit less and work well. It is the strongest chart pattern in that it often leads to another doubling in rapid order.