I have been quiet for a couple of days. I do some CANSLIM teaching each week which takes time away but the real reason is that the Market School I attended in Las Vegas has began a flurry of activity building an automated market model. What I found at Market School which I have already commented on was a market timing model that fits my trading style. It is designed to get me in when it is appropriate, keep me in when it is appropriate and take me out when it is appropriate. This means when the market is rallying that I stay in for the length of the rally. This model has navigated the choppy waters of the current market so well that my hat is off to Bill O'Neil and his merry band of portfolio managers who seemed to have caputured the essence of O'Neil in a rule-based model.

The model went to +4 market exposure count two days ago from +5 and back up to +5 today which equates to a drop back to 90% invested two days ago and a green light for 100% in after today's market action. Today's signal was an additional FTD (up more than 1.25% on higher volume than yesterday) bringing the count to +5.

Essentially the market has been in an undeniable rally choppy as it is. The leadership has firmed up and many stocks have rallied in a way that you can buy them at propper buy points, not get shaken out, and then hold them to harvest points. Essentailly a CANSLIM rally that has been working.

The flip side of the coin is the action at the 200-day moving average. This has stopped the last five bear markets in their tracks with a subsequent move to the downside. We have been visiting this level for a while. In history this resolves itself fairly quickly. We either take the high road and move up above the 200-day and stay there or we continue down for the next leg down. My personal opinion is that we will take the low road but my opinion means little. Price and Volume will lead the way and keep us sane. In IBD tomorrow they keep the market Under Pressure.