Leaders Index 3-26-14

The market continued it’s recent pattern today. After opening with solid gains the major averages topped out in the first half hour and it was all down hill from there. Late selling had the market closing at it’s lows of the session on heavy late volume. Overall volume was considerably higher across the board and was also above average. The Nasd averages were weakest with the COMPQ lower by 1.43% while the SPY was off .70%. This produced distribution on all the major averages. The Nasd averages are below their important 50dma while the New York averages are holding up better and are only below their short term moving averages. The action caused IBD to call market in correction. Leading stocks continued to get slammed as the leaders index fell 2.85% on very heavy volume. This is now four down days in a row on very heavy volume and the index closed just below it’s critical 50dma. The RS line of the index also closed below it’s 50dma. The COMPQ is now 4.25% below it’s recent high while the New York averages are much closer to their highs. The action of the market is very negative and while it could always snap back as it has often done recently the fact that the Fed is reducing it’s money printing may provide less of a floor. The most important thing is always to protect your capital, so a very cautious posture is warranted now. Jerry