Leaders Index 11-21-19

The market sold off today fairly mildly. The major averages opened lower and then recovered much of their losses. The major averages traded in a pretty tight range and closed with modest losses. The Nasd averages were a little weaker with the COMPQ and the NDX off by .24% and .22% respectively. The SPX declined .16%. The New York averages closed in the upper half of their trading ranges while the Nasd averages finished just below the middle of their trading ranges. Volume was lower across the board. It was off by only .48% on the New York and by 11.93% on the Nasd. There was no distribution today. Leading stocks sold off again today. The leaders index declined 1.71% on the session and closed low in its trading range. Volume was lower and below average so there was no distribution in quality growth stocks. The index also closed below its 9dma. The market has acted weaker in the last couple of days and that can be seen in both the major averages and the leaders index. The charts of the major averages still look good and the declines of the last couple of days look pretty orderly. There are a couple of red flags out there in the form of Hindenburg Omen signals and some divergences that still exist. The biggest negative right now is the action of leading stocks. The leaders index has broken some short term support at its 9dma after rallying above it since late Oct. Two of the best stocks of the current rally, PDD and INMD have broken badly in the last couple of days. The best thing the current market has going for it is the outperformance of leading stocks. It is too soon to say this has changed, but the last couple of days have seen leading stocks take a hit. I still think that the most likely course for the market is a rally into yearend, but I’m a bit less confident than I was earlier in the week. Jerry