Monkey needed a little bit of lovin' and the good market obliged him with some seriously racy action this week.

Markets have been very strong of late and none more so than the Dow. I've been day-trading the Dow a lot recently and it's been obvious that almost every single dip is being bought by eager traders. Anyway, I made a few more profitable day trades this week but the real money has come from an overnight position I took at the end of last week.

Some decent selling saw the Dow post its first triple-digit decline (147 points) since March. Weak economic data was blamed but it looked like simple pro"t-taking to me and, with the price coming down to touch its 10-day moving average for the first time in a month, I dived in just before the closing bell and bought near 13,200. I placed my stop 100 points below my entry and had an initial target of 13,400 (its 52-week high), which is a pretty decent risk: reward ratio.

Anyway, normal service was resumed over the following days, with the bulls driving the market upwards while the bears whined about the irrationality of it all. By Tuesday, I was able to offload half of my position just shy of the 13,400 mark. The buying continued on Wednesday, putting the Dow in touching distance of 13,500 and giving me a pro"t of almost 2,000. I won't refuse it.

That was nice, but buying Amazon was sweeter still. I wrote last week that I was looking to buy on a dip to the $60 area and, after stalking the stock all week, I finally got my chance on Wednesday.

The stock has been in a $60-64 trading range over the past three weeks and I knew that $60 should act as support. I elected to use a tight stop loss order (under $59) and was looking to take partial profits around $63.50 (near the top of the recent trading range). In other words, a risk: reward ratio of more than 3:1 . . .exactly the kind of trade you should be looking for.

I was optimistic that this trade would work out but I thought it would take days rather than hours. Happily, I was wrong. The stock enjoyed an initial modest bounce before taking off after lunchtime. Trading volume went through the roof in the last hour of trading and I offloaded half of my position at $63.20. OK, I was meant to wait until $63.50 but, having made over 2,000 in a matter of hours, I was eager to cash in some of that lovely lolly.

I have to admit to being pretty overjoyed with Wednesday's action and I'm looking forward to more of the same from Amazon. The Amazon chart is a very sexy one. If it can break past the aforementioned resistance at $64 . . . which I expect it will . . . it could go much higher.

Some readers will doubtless be curious as to the cause of the Amazon strength. The more meticulous among you might even decide to waste some time analysing the company's "nancial reports or checking out useless broker reports.

Don't bother. Doing so is as futile as it is boring.

Amazon trounced earnings expectations recently and has soared almost 50% since then. I couldn't tell you the exact details. I couldn't tell you what its expectations are for next quarter. I couldn't tell you about organic growth rates or whatever buzz words the bluffers in the analyst community come out with. A large company like Amazon does not rise by 50% unless the news is good . . .that's all you need to know.

As for the rise on Wednesday, the media will put it down to Amazon's announcement of the forthcoming launch of a digital music service.

Complete tosh. Everyone was expecting such a move. The price rise took place in the last few hours of trading, long after the announcement had been made. The massive trading that took place in the last hour of trade suggests that people expect it to go higher. That's all that interests me.

As for the Dow, there's still no sign of an imminent top. Small-cap stocks and technology issues have shown many signs of weakness recently but the Dow, which consists of large, mature companies, looks much healthier.

Over the last 22 sessions, the Dow has closed nearer its daily high than its daily low on 19 occasions. The average close has been just 26 points off the day's high and 66 points off the day's lows. Clearly, institutions are still "nding value in the big stocks. In fact, both Warren Buffett and George Soros disclosed this week that they had doubled their stakes in some Dow stocks (Johnson & Johnson and Microsoft, respectively).

It's tempting to short a market as overbought as this one. Tempting but misguided. You don't want to be trading against the big boys and the big boys have been buying, no doubt about that. I'll get out when the Dow tells me it doesn't want to go higher.

For now, that's not what the market action is saying.

My recent losses have come when I've fought the ticker tape. This week, I let the trend be my friend and had a bloody good time in the process. If next week is anything like this one, well, like I said earlier, I won't refuse it.

Weekly gain/loss: + 4,500
Overall balance: 42,200