Leaders Index 12-13-17

The market again started out with solid gains, but by the end of the session most of them were lost. All the major averages closed near the lows of their intraday trading ranges, a sign that early price gains were met with selling. The COMPQ finished with a gain of .20% while the SPX declined .05%. Volume was slightly higher across the board and above average on the New York. This was enough to produce stalling on the COMPQ. The SPX avoided stalling and outright distribution because of the small loss. Leading stocks were generally higher, but the gains were small. The leaders index finished with a gain of only .02%, although much of the small gain was caused by significant losses in NVDA and SQ. The index closed near the bottom of its trading range. That combined with slightly higher and above average volume led to a stalling day in the leaders index. The index also held above its important 50dma support level, although if it keeps trading just above this moving average for too long the chances of breaking below it increase. The fact that much of the early gains were lost is a cause for concern. There have been many sessions like this recently and that means that strong price action is being met with selling. The charts of the major averages look solid, but the action of many leading stocks is worrisome. Many of the stocks that have been leading all year, like NVDA, SQ and BABA have rolled over and issued sell signals. It’s hard to figure out where the market will go from here. When leading stocks get into trouble it usually leads to lower prices. On the other hand the major averages are acting well, particularly the New York averages. The market could go either way here and only time will tell if the rally will continue into the new year. Jerry