Leaders Index 3-10-16

The market was a real roller coaster today. After opening stronger on the ECB announcement that it was lowering rates the major averages produced solid gains early. That rally lasted about a half hour before the ECB said it probably wouldn’t lower further and the market sold off until it produced strong losses. It looked like it would be a very weak session, then around mid day the major averages rallied and recovered most of the losses. The SPX finished with a very slight gain of .02% while the COMPQ ended lower by .26%. Both closed in about the middle of their intraday trading ranges, a sign of some support by large institutional players as they closed well off their lows. Volume was higher across the board, but still below average on both exchanges. This was enough to produce distribution on the COMPQ, although it was a fairly tame distribution day. Leading stocks were lower as well with the leaders index falling .39% on higher but still below average volume. This produced distribution in quality growth stocks as well. The index again traded below it’s important 17dma during the day but rallied to close in the upper half of it’s trading range. The index continues in it’s recent consolidation, but when an index keeps tagging an important moving average it will likely eventually fall below it. It would be good to see the index put some room between itself and this moving average. The relative strength line of the leaders index is now showing a little weakness with some lower highs. This continues to be a struggling rally with few positions producing any worthwhile gains. In the Marketsmith 250 today there were 19 stocks higher on volume while 144 were lower on volume. The bottom line is that while the major averages still have decent looking charts for this rally attempt it is very difficult to make much if any progress, and that is the really important factor. A good deal of caution is warranted right now. Jerry