Interestingly with so many stocks going from oversold to overbought in the span of 72 hours, F5 Networks (FFIV) is not among them.  While it barely suffered a scratch during the selloff the past few weeks, it has not really advanced much either.  Instead it has built a nice 5-6 week base between the mid $80s and low $90s.  Today is the first day it has breached $92.50 since early August and in a benign market I'd say this is a no brainer for a new leg up.  In *this* bipolar market - who can ever tell.

It has been a very telling day as I said this morning it would be.  ISM Services just came in at 51.5 versus expectation of 53 and previous month's 54.3.  Again, ISM Manufacturing gets all the press as if we still live in the economy of 40 years ago, but ISM Services is the much more representative report.  The S&P 500 sold off an entire 1.5 points on the knee jerk reaction.  Two weeks ago ...heck earlier this week, this would of caused a 2% swoon.

I said I'd be looking to add some long exposure but that does not mean I am not going to sell some as well; what I want to do is sell some of the overextended names and buy some things that are not so overbought.  This way I can keep a decent long bias, but just change the mix of names & exposures.

Here are some sales (I've included Relative Strength index in the chart to show one signal of 'overbought')

I'm selling half of remaining Acme Packet (APKT) near $36 and will look to buy back on a pullback.

Shares of Take-Two Interactive Software (NASDAQ:TTWO) rallied more than 14% in pre-market trading after the company reported a surprise profit for the July quarter late Thursday and boosted its forecast for the remainder of the fiscal year. The company is now predicting an annual profit, which will be the first time it has done so without a new release from its “Grand Theft Auto” franchise. In other news, Campbell Soup (NYSE:CPB) said fourth-quarter net income rose to $113 million, or 33 cents a share, from $69 million, or 20 cents a share, in the year-ago period.

As Richard Russell and many other experienced market analysts have pointed out, the job of the bear during a bear market is to entice as many people as possible into his nice warm den in preparation for his next meal. Hence, markets do not head straight down. They bounce back up to provide investors with the hope that the tough times are over and that if they just stick with it a little longer, they will get their losses back.