Leaders Index 1-19-16

Today’s action continued a familiar pattern. The market showed real strength at the open, mostly on positive action in overseas markets, but couldn’t hold the gains. The major averages saw their intraday highs in the first hour of trading and it was mostly downhill from there. Some late strength saw the major averages close off their lows and mixed on the day. The New York averages manages small gains while the COMPQ couldn’t get back to break even. The SPX closed with a gain of .05% while the COMPQ lost .26%. Volume was lower across the board so there was no distribution on the session. Leading stocks did better than the overall market with the leaders index gaining .53% on the day on lower but still above average volume. The gain did little to improve the charts. The 50dma is flattening out and the short term 9dma continues to rule the pattern. Early strength followed by late weakness is the type of pattern you see in a bear market. There is no follow through on the early gains. The market continues to be unable to rally even after the strong sell off. Markets that can’t stage strong snap back rallies are usually destined to go lower. Nothing is working and the best place to be right now is on the sidelines. Jerry