Leaders Index 1-22-19

The market sold off pretty hard today. After opening lower the major averages worked their way down most of the day. Some late buying saw them finish off their lows, but the declines were substantial. The Nasd averages were the weakest with the COMPQ and the NDX lower by 1.91% and 2.03% respectively. The SPX declined 1.42%. All the major averages closed in the lower half of their intraday trading ranges, showing little buying interest as prices fell. Volume was lower across the board. This means that there was no distribution today, although Friday’s trade was inflated by the expiration day. Leading stocks were lower as well with the leaders index falling 1.98% on the day. The index closed in the lower half of its trading range and volume was higher and above average. This was the first trading session we have had in a couple of weeks with any significant losses. The decline was pretty big but the overall damage was limited. The volume on both exchanges was lower so fresh distribution was avoided. The higher than usual volume associated with expiration days made the comparison easier, but the fact is that volume was lower on the decline. The major averages and the leaders index also held important support. The major averages all traded close to or below the important 50dma now support level. This support held, which is a good sign. The leaders index traded below its short term 9dma but held this short term moving average. The major averages are all within one percent of their 50dma’s so they can’t fall much further without triggering a major sell signal. The market is generally acting well but must advance from here to continue the rally. Jerry