Leaders Index 11-1-13

The market overall was up slightly yesterday. The strength was in the New York averages with the INDU leading the way with a .45% gain while the SPY was up .29%. The COMPQ rose only fractionally, up .06% while the RUT was down .41%. The action was more in the big cap defensive names. Volume was down across the board so the was little conviction in the day’s action. Leading stocks were mixed as they continued to underperform the major averages. The leaders index was up .35% on lower but slightly above average volume. The red candle shows that the index closed below it’s opening price, a sign of weakness. The index continued to trade below it’s important 17dma and is beginning to live below this level. The 9dma is also breaking below the 17dma. The divergence between the major averages and the leaders is continuing. The major averages still trade near their highs while leaders struggle. Divergences like this must eventually be resolved and it is difficult to see how the soldiers will remain advancing for long while the generals are in retreat . Anything can happen in the stock market, but it is looking more likely a this point that the divergence will be resolved to the downside, Jerry