Jerry Samet
08-24-2016, 07:20 PM
It was a pretty negative day for the market all around. The major averages opened lower and worked their way down for the rest of the session. A small rally at the close saw the major averages close off their intraday lows, but they all finished near the bottom of their intraday trading ranges. The COMPQ lost .81% and closed below it’s short term 10dma. The SPX declined .52% and is now under it’s 10dma and sitting on it’s 20dma. Volume was higher across the board. This showed that large institutional players were selling stock today and produced new distribution on all the major averages. Leading stocks didn’t do well either with the leaders index falling 1.20% on the day, basically giving up what it gained yesterday. The index closed in the lower half of it’s intraday range and is now below it’s 9dma, but is holding above the important 17dma,. Volume was higher on the index and was about average for the first time in over a week. This constitutes distribution in quality growth stocks, not what you want to see. The market appears to be struggling and both the major averages and the leaders index have been unable to make any progress in weeks. The distribution count is getting to a worrisome level. A couple of the more secondary intermediate term indicators I look at, like the Summation Index and the A’s minus E’s are looking weak. The weekly Coppock though continues to increase. I would take a more cautious stance right now and look to protect profits along with being careful on new positions. Everyone is being careful ahead of Yellen’s speech on Friday. We may get a better picture after that. Jerry