The market continues to drop as bad news continues to overcome any Merger and Acquisition euphoria that may attempt to rally the bulls and lift the market. Money continues to leave stocks and might be moving into bonds (causing some to forecast a bubble in the bond market). If a bubble in the bond markets is forming, there might be opportunity to make money on the downside once the bubble bursts. (By being short on Treasuries, for example). I am researching some ETFs that may have such a focus. Of course, such ETFs have been losing money for their investors over the last few months.
I continue to stay mostly in cash. The only new position I have opened lately is Nvidia. The action is encouraging at this time. The downtrend line has been broken to the upside. Also, the key fundamental news driving this change in trend could be that Nvidia is entering the smart phone market with a dual core processor. Which means they will be going up against QualComm's Snap Dragon processor which is a popular processor in the latest generation of Android phones. LG has committed to using the NVIDIA Tegra 2 processor in a line of upcoming smart phones. At the same time, QualComm announced that a new dual core version of the Snap Dragon processor running at 1.5 GHz will be available in the 4th quarter. So it remains to be seen whether NVIDIA can successfully execute the mobile processor strategy and take some of the market share in the smart phone market.
For now, I am looking for a target of 13 to 13.50 for NVDA to take profits.
As I have mentioned before, the general trend of the market is not to be ignored. It doesn't generally matter how good the prospects for a stock are. If the market is headed down, it is likely that gains cannot be made to the upside since 3 out of 4 stocks will follow the market direction (up or down).
Another stock that I am looking at is First Solar (FSLR). It may be turning the corner and entering an uptrend. I will monitor and see if an opportunity to profit presents itself. But with September fast approaching, maybe sitting on the sidelines with cash is not a bad place to be...
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