Leaders Index 12-16-13

The market opened strong today on a rally in Europe caused by better than expected economic data. The major averages had strong gains ranging from .63% on the SPY to .71% on the COMPQ. Volume was higher across the board, which is what you want to see on a rally day. One thing that is a bit troubling is that all the major averages made their intraday highs in the first half hour of trading and while they held most of those gains they drifted slightly lower for the rest of the session. Action in the leading stocks was disappointing as the leaders index actually declined .44% on lower and well below average volume. No one stock took a big hit that would effect the index so it was general weakness, or lack of strength in the whole index. The important 17dma continues to to provide resistance for the index. When quality stocks lag the major averages it is a big red flag, and they have been lagging for some time now. A limited number of stocks are acting ok now so it is alright to hold some positions, but a good deal of caution is advisable. The Fed meeting starts tomorrow with the announcement on Wednesday, so this will likely set the tone for the next couple of days. Jerry