Leaders Index 12-12-16

The market took a bit of a rest today. The major averages opened mixed and spent the rest of the session working their way lower to finish with modest declines. The COMPQ was lower by .58% on the day while the SPX fell .11%. Both closed in the lower half of their intraday trading ranges. Volume was mixed on the day. Lower on the Nasd and higher and above average on the New York. There was no distribution on the day as the decline in the New York averages was too small to qualify. Leading stocks were lower as well and were much weaker than the overall market. The leaders index dropped 1.42% and closed in about the middle of its trading range. The index finished just below the important 17dma and holding this support level is critical. The relative strength line of the index is starting to look a bit sickly and a pattern of lower highs and lower lows is starting to set in. Overall the market seems to be consolidating recent gains in a fairly orderly fashion as today’s declines in the major averages were pretty small. The leading stocks are underperforming the major averages as the leaders index has not been able to break into new high ground and is struggling with important support. We are in a seasonally favorable period and we could well continue to work our way higher, but the underperformance of quality growth stocks is something to keep an eye on. Jerry