We're Still Macro Driven

 | Aug 24, 2011 | 10:30 AM EDT
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After some initial uncertainty the buyers are stepping up. Better action in banks and weakness in gold is enticing some buyers. Retailers are also perking up a bit. And if technology can find some traction we could develop a little momentum.

The biggest challenge in this market right now is that it isn't an environment for individual stock picking.  We are macro driven and fundamentals and charts simply don't mean much.  The indices are driving the action and it doesn't much matter what vehicle you choose.

I much prefer a market that places a premium on picking good stocks, but we have to keep plugging away while we find what works. Right now that seems to be to play the ETFs or some of the big-cap names.

As I said a couple times recently, we have to give the bulls some room once these sorts of bounces kick in. The nature of this market is to bounce much bigger than most people expect.

I see very few interesting chart setups but Acorn (AKRX), a small drug company, caught my eye. The stock has been hovering around its highs the entire time the market has corrected and is now looking to breakout. In its most recent quarter the company had revenue growth of 59% and earnings jumped to 17 cents per share from a loss of 10 cents. Valuation looks attractive and the chart is one you don't see many of right now.

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