Leaders Index 7-31

The market had a strong opening with all the major averages up close to one percent at their highs. After selling off a bit the market rallied briefly after the Fed announcement, only to sell off into the close and finish at the lows of the session. The COMPQ finished up .27% and the New York averages finished with small losses. Volume was higher across the board, which produced a stall day on the COMPQ. Leading stocks did a bit better than the overall market as the leaders index rose .71% on higher and well above average volume. This is an accumulation day on the leaders index. The market seems to be struggling a bit now with the leaders index continuing in it’s recent consolidation and the major averages starting out strong and losing steam during the trading day. This is not the type of action that strong markets show. This and the high number of distribution days combined with the clear roll over in the A’s minus E’s are some red flags that must be watched closely. The market has not issued many real sell signals yet and a few strong up days on higher and above average volume would go a long way toward improving the picture, but there are some worrisome signs out there. Jerry