Leaders Index 6-12

The market got off to a strong start today with all the major averages opening higher. It looked like the market might recover yesterday’s losses, then within ten minutes a sell off began. The rest of the day was spent going lower and the major averages finished the session at their lows with losses ranging between .71% on the NYA and 1.06% on the COMPQ. Volume was mixed, higher on the Nasd and slightly lower on the New York. This produced distribution on the Nasd averages. Leading stocks got hit harder than the overall market as the leaders index fell 1.56% on higher but below average volume. Both the index and it’s RS line are clearly headed lower. The New York averages are weaker than the Nasd averages as the NYA is clearly below it’s 50dma and the SPY is sitting on it’s 50dma. We should see if the major averages and the leaders index take out recent lows and reinforce the pattern of lower highs and lower lows. The brief wedging rally off recent lows has clearly failed and it appears the market will see lower prices. Jerry