Leaders Index 8-1-18

The market has been generally weak while I was away. After selling off the market tried to bounce today. There was a divergence in today’s action with the Nasd averages having a good session and the New York averages putting in a weak performance. The COMPQ and the NDX were higher by .46% and .57% respectively. Both finished high in their intraday trading ranges. The SPX was lower by .10% and closed low in its trading range. Volume was mixed also as it increased on the Nasd and fell on the New York. Leading stocks were higher today but have put in a poor performance over the last few days. The index gained 1.65% today on higher and above average volume and closed in the upper half of its trading range. The market has put in a negative performance overall recently. The COMPQ Broke below its 50dma but managed to recover it. The higher volume on the Nasd and lower volume on the New York were generally supportive. The leaders index broke below its critical 50dma on Thursday and has been unable to regain this moving average. If they can’t rally above this now resistance level the implication for the market are not good. The weakness in quality growth stocks is not good for the market. A rally with conviction would be encouraging. A good stock to watch is GRUB. It gapped up on strong earnings and id pulling back in a pretty orderly fashion. If this breakout fails it will be very negative. The market looks like it is under some stress right now. The charts of the New York averages still look pretty good and the COMPQ need to rally further above its 50dma. The negative action in leading stocks is worrisome, but the market has quickly recovered from sell offs in the past and may well do so again. Right now some caution in taking new positions is a good idea. Jerry