Leaders Index 8-6-15

It was an ugly session today with all the major averages opening lower and declining most of the day. About the only good thing you can say about the session’s action is that the major averages closed off their lows. The losses were meaningful, especially in the Nasd averages that have been leading the market. The COMPQ fell 1.62% while the NDX declined 1.60%. The New York averages held up better with the SPX declining .78%. Volume was higher across the board so it was a distribution day on all the major averages. The COMPQ joined the other major averages below it’s 50dma and other averages are looking worse. The INDU and RUT are both below their 200dma’s and both are close to a death cross. Leading stocks got crushed today as the leaders index fell 3.63% on much higher volume. The big red candle is a very negative sign and the fact that we had such a large decline the day after the index set a new high on good volume shows how difficult it is to navigate the current environment. The leaders index broke below it’s important 17dma today, which is very negative. Only one stock in the IBD 50 was higher today. We are clearly seeing late cycle instability in the market. There are no real trends and the markets can seem to move in one direction for only a few days before they reverse. Your stock picking and timing must be perfect to make any progress, and not many can do that. Extreme caution is the order of the day and a large cash position is a good idea. Jerry