Jerry Samet
02-12-2018, 06:42 PM
The market continued higher after the reversal we saw on Friday. The major averages opened with solid gains and after a little early selling turned around and rallied for the rest of the session. A little late selling saw the major averages close off their intraday trading highs, but still high in their trading ranges. The COMPQ finished with a gain of 1.56% while the SPX rallied 1.39%. Volume was lower across the board but still above average. It would have been preferable to see higher volume today, but Friday’s volume was very strong so beating it would have been hard. Leading stocks rallied as well with the leaders index rising 1.78% and closing high in its trading range. Volume was also lower on the index but was above average. I said in my last update that the kind of reversal we saw on Friday can lead to at least a short term bottom in the market. Today’s action seems to reinforce that as we had a strong rally today, at least on a price basis. It would have been good to see higher volume on the price advance, but the action was still positive. It is a little early to get to excited as there are few quality growth stocks that are in attractive looking set ups, but we are in day two of a rally attempt. The real hurdle facing the major averages and the leaders index now is the 50dma. All the major averages and the leaders index are below this important moving average and regaining it is the first step in improving the overall picture. Jerry