Leaders Index 11-4-16

The market made another attempt at rallying yesterday, but again the attempt failed. The major averages opened higher and made modest gains for a few hours before selling came in and all the previous gains eroded and the major averages finished with losses. This makes nine days in a row of declines. The COMPQ closed with a decline of .24% while the SPX lost .17%. Volume was lower on the Nasd and while IBD had it lower on the New York esignal had it slightly higher. The difference was very small and different data feeds could have different numbers. Either way the loss on the SPX was too small to qualify as distribution. All the major averages closed at or very near their intraday lows, a sign of weakness. Leading stocks did a little better than the overall market with the leaders index gaining .10% on the day. The index closed low in its intraday trading range and volume was much lower than Thursday and about average. The volume was much lower when the index stabilized than when it sold off. This is not a good sign. Right now the first hurdle the index will face in any real rally attempt is the declining 9dma. The 17dma is about to join the 9dma below the 50dma. The charts of both the major averages and the leaders index look bad. There has been a strong decline in the last couple of weeks and the market has shown no ability to make an even weak bounce. The real test will come when that bounce attempt begins. The quality of the bounce is critical in trying to figure out if the worst is over. We are overdue for a bounce here, but so far it looks like there will be lower prices ahead, although with the election next week there will likely be a lot of short term volatility. Jerry