Leaders Index 5-21-25

[Jerry Samet]

The market sold off today on higher volume. The major averages opened lower but rallied to some gains, especially the NASD averages. Selling came in and drove the major averages to significant losses. All the major averages finished low in their intraday trading ranges. The COMPQ and the NDX lost 1.41% and 1.34% respectively. The SPX declined 1.61%. Volume was higher across the board, resulting in a new distribution day on all the major averages. Leading stocks sold off as well. The leaders index fell 1.57% on the day. The index closed low in its trading range on higher but below average volume. The index at its low tagged the short term 9dma, but held this support. The market was acting pretty well with early losses being mostly erased. Selling came in when a Treasury auction didn’t go well. The selling continued into the close and the major averages finished weak. Volume was a good deal higher, showing that large institutional players were selling today, but the distribution count remains low. The important question now is was this on one day event because of the auction or the start of a decline. Then what kind of decline would it be. Either a short pullback after recent gains or a larger retracement. There is weak support at the short term moving averages and strong support at the 200dma’s of the major averages. If this important moving average doesn’t contain any decline then a retest of recent lows may be in the cards. Jerry