Jerry Samet
02-17-2016, 11:32 PM
The market had another strong session today, marking the third day in a row of solid gains. The major averages opened higher and held the gains for the rest of the session, finishing at or near their intraday highs. The COMPQ led the way higher with a gain of 2.21% while the SPX rose 1.65%. Volume was higher across the board, and as I discussed yesterday there was a new follow through today. Leading stocks has a good day as well. Since there was a new follow through I created a new leaders index. It consists of 19 stocks in 16 different industry groups. I have included a text file with the new index and also included the chart of the previous index for comparison purposes. The new index gained 2.09% on the day on slight lower but still above average volume. It is well into new high ground, as you want to see in a new index, and the relative strength line is almost straight up. The previous index closed at it’s 50dma, and it will be interesting to see if it can get above this important resistance level. I have to say that it was very difficult to put together a new index, usually a negative sign. There were many stocks in the index from groups you usually don’t associate with a growth index, like food stocks, utilities and metals. The three confirming indicators look better in this follow through than the last two that quickly failed. There was a Eureka signal today as market internals were very strong today. As I said yesterday the weekly Coppock is showing definite signs of a curl. That became more pronounced today. It the Coppock can signal this week or even next it will confirm the follow through. The %E’s were 27.5% today, much higher than the desired range so this indicator did not confirm. Despite the positive action of the last three sessions there still isn’t much of anything to buy. The Marketsmith 250 has a breakout screen and it showed no breakouts today. The lack of buyable stocks and the high %E’s is a cause for caution and I would take new position very carefully, but this follow through looks a bit better at the start than the last two. Jerry