Leaders Index 6-13-14

After two days of declines on Wednesday and Thursday, including across the board distribution on Thursday, the market needed to regain it’s footing on Friday. It did that to a degree by having a positive day with all the major averages rallying, but it was not as strong a rally as you would have liked to see. All the major averages rose about the same amount with the COMPQ up by .30% and the SPY higher by .31%. Small and mid cap stock averages showed similar gains. Most of the major averages closed at or near their intraday highs, which is good. The real punch was in the SOX, which was higher by .99% and went into new high ground. Volume was lower across the board. This is not unusual for a Friday in the summer, but it would have been more encouraging to see more conviction on the part of institutional players. Leading stocks had a rally day as well with the leaders index climbing by .75% and closing in the upper half of it’s intraday range. The index tagged it’s important 17dma for the first time since the follow through but held. It then rallied back up to close just above it’s 9dma. Volume on the leaders index was well above average, which is a good sign, but was slightly below Thursday’s level. The distribution count remains fairly low and the COMPQ bounced off it’s 10dma and held. The SPY is now back up to it’s 10dma. Little real damage has been done by the declines of Wednesday and Thursday in either the major averages or quality growth stocks. If the market rallies in convincing form next week we will be in good shape and will likely see higher prices ahead. If we get more declines on high volume the rally will likely fail. Jerry