One of the guys here on the forums gave me an old spigot nozzle (PCOOL) that was doing the same thing. This was the older 20 position PCOOL nozzle.
Another guy suggested that I take it apart and check the micro switch that rides on the cam. As it turns out the micro switch was missing some of the steps and caused the problem. I found a replacement micro switch at a local electronics store for around $2.00. I had to modify it a little but that fixed it and it has been working perfect ever since.
There is a post either here or on PM that has the pictures to show what was done to fix it. I don't know if the newer PCOOL nozzles are different or not. But before you throw it away I would check it out.
Let me know if I can be of further assistance. Just send me a PM with your phone number and a good time to call you and I will give you the details.