I took a number of new trades this week but they failed to go anywhere special. I got stopped out of my remaining positions in the Nasdaq and Elan. I took another long entry in Elan near $20 (50-day average) on Tuesday. It was looking good for a few hours but the stock turned against me in the afternoon.

It opened lower next morning, rose 5% off its low point before dipping back down again. I took my leave at the break-even point. Bit too choppy for my liking.

The market tanked on Tuesday (sub-prime concerns and lacklustre earnings) and I attempted to catch a falling knife by buying into the S&P at its 50-day average. The S&P hasn't looked as strong as the Dow or Nasdaq recently but it was still in a clear uptrend so I thought it was worth the risk.

Unfortunately, it kept going south and I was down the guts of 700 at the closing bell. Thankfully, strong earnings from Amazon on Tuesday evening lifted market spirits and I was able to get out at break-even the next morning.

I know some traders prefer to hang on and either wait for their stop loss or their price target to be hit.

That's fair enough . . . not so long ago, I'd have done the same. These days, however, I prefer to be in pro"t from the very outset. If I'm not, it means things haven't gone according to plan and I change my outlook. It's a defensive method and it helps to minimise my losses. If the S&P goes on to new highs, I'm not going to beat myself up about it. Defence before offence is how this monkey plays the market.

The chart shows that Wednesday was an 'up day' but it didn't feel that way for long periods. The markets opened higher before giving up all their gains and slipping into the red. I shorted the Dow after the bulls managed to claw their way back up.

It went my way but instead of taking my pro"ts . . . this was to be a day trade, as I remain bullish in general . . .I decided to hold out for a few dollars more. The market action had a decidedly bearish hue to it all day and I felt that some kind of capitulation was near.

It wasn't. The bulls took control in the last hour and I got stopped out . . .yet another break-even trade.

I've been citing the views of Dr Brett Steenbarger over the last few columns. His suspicions of the recent breakout turned out to be well-founded. He's been pointing out that institutional participation has been diminishing of late and that the strong price action masked underlying weakness. A spate of ugly news items on Tuesday meant that the pretence could go on no longer.

"The indicator weakness noted in the last two weblog entries was the drought; the news. . . was the match; market burned" was his pithy reflection on Tuesday's slaughter. Steenbarger is no bear, however. He points out that there was an explosion of stocks (over 1500) registering 65-day lows on Tuesday. This has only happened ten times since 2004 and US indices have "been up "ve days later all 10 times, by an average of 1%".

That may not sound like much, but it's over six times the average five-day gain during that period.

Look out 30 days and markets have been up an average of 4.3% (nine up, one down). If you're going to get short, don't do it after a bloodbath . . .that's what the evidence is showing.

Still, I wouldn't jump in willy-nilly.

Wednesday 'should' have been a stronger day (oversold market, blistering earnings from Amazon).

The uncertain price action showed a "wavering of what used to be unbridled bullish sentiment", as one website put it. I'd like to see the Dow or Nasdaq dip down to their 50-day average and load up there. The S&P has looked weaker . . . it would take a dip to the June lows for me to consider another long position.

The Irish index has been taking a pounding recently. I don't trade it and am not going to pretend to be an expert here. Still, it's obvious that all has not been well for some time now.

Practically every index around the globe went sky high in the months following the correction in late February. The German Dax rose by almost 25%, the French CAC by 20%, the Japanese Nikkei 10%, the FTSE 10%, the S&P 15% and the Nasdaq by 20%.

The Iseq, in contrast, just chopped around, failing to breach the high of 10,000 set last February.

It's obvious that institutional investors were having second thoughts about the Irish market and the recent falls (a loss of 700 points in less than a fortnight) can hardly be seen as a bolt from the blue.

Over the last few years, the Iseq has tended to dip when global markets went into a tailspin. This time, the Iseq is falling all on its own. I assume the property bubble . . . sorry, property market . . . is the big concern.

In the US this week, one mortgage lender reported that the recent home price depreciation was the worst it had seen since the Great Depression. Of course, it couldn't happen here. . .

The recent losses have seen the Iseq surrender its 200-day moving average. Check out a "ve-year chart . . . that level has provided consistent support since the bull run began in 2003. I'm not saying that this means the Irish bull market is over . . . it briefly dipped below the same average in 2006 before rebounding strongly . . .but it sure isn't a good sign.

Weekly gain/loss: . . . 700
Overall balance: 52,800