Jerry Samet
09-25-2019, 06:28 PM
The market opened lower today and it looked like the selling of yesterday would continue. About a half hour into trading the major averages bottomed out and started to rally. This was attributed to comments that a trade deal with China might happen sooner than expected and some news that the impeachment threat might not be as bad as thought. The major averages rallied into the close and all finished at or very near their intraday trading highs. The Nasd averages were the strongest with the COMPQ and the NDX gaining 1.05% and 1.21% respectively The SPX was higher by .62%. Volume was lower across the board. It fell by 12.18% on the Nasd and 16.74% on the New York. This is not encouraging. Leading stocks were higher as well with the leaders index rallying .99% on the day. It closed high in its trading range on lower but above average volume. The market put in another news driven rally today. The Nasd averages regained their 50dma’s, but the leaders index remains below this important now resistance level. The market recovered most of yesterday’s losses, which is encouraging. The real problem was the volume. We again had a lower volume rally after a higher volume sell off. This shows that large institutional players were not buying that heavily today. The fact that there was lower volume on the rebound is a negative factor. Also the leaders index remained below its 50dma and the relative strength line shows that quality growth stocks are underperforming the overall market. That is never a good sign. The market still seems to be struggling and a good deal of caution is warranted. Jerry