Leaders Index 3-19

The market had another negative day today. The major averages closed well off their lows but except for the Dow they all closed lower. Market internals were more negative as advancing and declining issues and volume were down on both exchanges. Volume was higher across the board which produced distribution days on all the major averages. Distribution is starting to build and much more will present a real problem for the rally. All the major averages are now below their 10dma’s and we must watch to see if they break below the 21dma’s. Leading stocks underperformed the overall market as the leaders index fell .54% on lower and slightly below average volume. The index bounced off it’s 17dma for the second time in as many days. It is trading below the 9dma for the fourth day and if it can’t put some distance between it and this important moving average it is likely to break below it. Quality stocks are acting pretty sloppy and distribution is building on the major averages. If the market doesn’t start acting better soon the rally could be in trouble. Jerry