Leaders Index 5-7-18

The market has tried to stage a rally after a reversal day on Thursday. The market staged a solid rally on Friday and continued higher today. The COMPQ was higher by .77% today while the SPX rallied .35%. They closed strong on Friday but the New York averages closed low I their trading ranges today while the Nasd averages finished in about the middle of their trading ranges. Volume was lower across the board, again. Leading stocks did better than the overall market with the leaders index gaining 1.58% on the session. The index closed in the upper half of its trading range and is right at its all-time highs. Volume on the index was higher, a positive sign. The relative strength line of the index made a new high. The market had a positive reversal day last Thursday. This type of action can mean at least a short term bottom. The market has rallied the next two days, but the key has been volume. It has been successively lower on both rally days. This is a negative development. If it continues for a couple of more days the charts of the major averages will take on a wedging look. The Nasd averages have gotten over their 50 dma’s while the New York averages were turned back today at theirs. This so far looks like a fairly weak bounce as large players don’t seem to be participating. The best factor right is the fact that quality growth stocks as seen in the leaders index are acting better than the overall market. We will have to see how far this rally attempt can go but now is not the time to be to courageous. Jerry