Jerry Samet
09-09-2019, 07:40 PM
It was a split personality type of day today. The major averages held up pretty well. The New York averages were stronger as there was a lot of weakness in tech stocks. The SPX was pretty much flat with a decline of .01%. The COMPQ and the NDX were off by .19% and .26% respectively. All the major averages finished low in their intraday trading ranges. Volume was higher across the board. It was up by 14.27% on the Nasd and 25.17% on the New York. There was no official distribution today as the declines were to small, but they were very close in the COMPQ. Leading stocks were hit hard and on volume. The leaders index fell 4.07% on the day and closed low in its trading range. The components of the index were rich in multiple percentage point decliners. Volume was extremely high, in fact it was the highest volume in months. The index broke strongly below its 9dma and 17dma. It also fell out of the consolidation pattern it has recently been n. This is negative. The action today was not encouraging. The major averages avoided larger losses because of a late rally off the lows. There was a large increase in volume, showing that large institutional players were selling stocks. The declines in the major averages were muted, so there was no official distribution. But it sure felt like a distribution day. Quality growth stocks were hit hard with the large decline in the leaders index and the big red candle on the chart. A lot of support was broken in leading stocks on very heavy volume. This is never a good sign for a rally. The leaders index held above its important 50dma, but its relative strength line is fast approaching this moving average. The COMPQ hit its 50dma, but held above it. If it breached this support it will be a huge red flag. A lot of damage was done today, particularly in leading stocks. The 50dmas of the major averages and the leaders index must hold. Jerry