Leaders Index 5-16

The market sold off today after remarks from some Fed governors said that QE could be cut back as early as this summer. The major averages declined between .18% on the COMPQ and .65% on the NYA. Volume was mixed, higher on the Nasd and lower on the NYSE. There were no new distribution days added as the decline in the COMPQ was only .18%, to small for distribution while lower volume on the New York prevented distribution there. Leading stocks were lower also as the leaders index fell .60% on lower and slightly above average volume. The index tagged it’s 10dma but closed well above it. In the context of the recent advance today’s action in the major averages and leading stocks was pretty mild. We are probably due for a pull back or at least some consolidation, but the solid look of the charts of the major averages and the leaders index, combined with the low distribution count suggests that there is not much cause for concern yet. Jerry