Leaders Index 2-25-20

The market got hit today almost as hard as yesterday as the almost panic selling generated by the coronavirus continued. The major averages were a bit higher at the open, but it didn’t last long. After about five minutes the major averages started selling off and continued lower for the rest of the session. The declines were almost as strong as yesterday with the COMPQ and NDX sinking 2.77% and 2.70% respectively. The SPX lost 3.03%. All the major averages closed at or near their intraday trading lows, showing that there was little buying interest as prices fell. Volume was higher again as it climbed 15.54% on the New York and 13% on the Nasd. This produced a fresh distribution day on all the major averages. Leading stocks were hit hard as well with the leaders index falling 2.24% on the day. The index finished low in its trading range and moved further below its 50dma. Volume was again huge and higher than yesterday. There is tremendous fear now as the uncertainty over the coronavirus spreading further and disrupting the international economy. There has now been a distribution cluster as large institutional players continue to dump stocks heavily. Many New York averages, like the INDU, the NYA, and the transports index are below their 200dma's. It is hard to argue that the rally is not over. At this point we are pretty clearly in a correction, the question now is how far the decline will go. Right now protecting capital is the primary objective. Jerry