Jerry Samet
08-20-2016, 12:05 PM
The market traded in a tight range on Friday with the major averages closing little changed on the session. The COMPQ lost only .03% while the SPX declined.14%. The real strength on the day was again in the semiconductor stocks as the SOX gained .87% and powered further into new high ground. The major averages closed high in their intraday trading ranges, which is a sign of support and is positive. Volume was higher across the board yesterday, as you would expect on an expiration Friday, but it was still below average. This shows that large institutional players were not heavily involved in yesterday’s trading. Leading stocks were lower as well with the leaders index falling .30% It underperformed the overall market and volume on the index was lower and well below average. The index finished in the upper half of it’s trading range, a good sign, and remains slightly above it’s short term 9dma and 17dma. The market appears to under a bit of stress after the rally that began in late June. Both the major averages and the leaders index tried to break into new high ground early in the week but fell back into their recent trading ranges. The distribution count is getting pretty high and this is another concern. The charts of both the major averages and the leaders index are still ok as they are still above their short term moving averages, but as I said earlier the direction they break from the current consolidation will likely tell us the fate of the rally. Jerry