Leaders Index 9-30-13

The market had a rough session today. After big losses at the open the major averages worked their way higher before selling off into the close. The COMPQ had the best day with a .27% loss while the NYA was worst with a decline of .65%. These closing prices were all well off their intraday lows, which is about all you could say that was good about the day’s action. All the major averages closed in the upper half of their trading ranges while the COMPQ was near the top of it’s range. Volume was higher across the board so there was distribution on all the major averages. Leading stocks sold off as well as the leaders index was down .70% on higher and above average volume. The index broke below it’s 9dma and tagged the critical 17dma and closed below it’s recent consolidation range. There are now five distribution days on the SPY and three on the COMPQ. Any more distribution would spell real trouble for the rally. The SPY is also sitting on it’s 50dma. Much of today’s weakness was due to uncertainty over a government shut down, but we are at a critical juncture here. Further weakness would be a good reason to raise cash. Jerry