Leaders Index 6-19-20

The market started off strong yesterday as the major averages gapped higher at the open. It didn’t last as a reversal set in and the major averages sold off for pretty much the rest of the day. All the major averages finished low in their intraday trading ranges, a sign of little support. The Nasd averages closed with small gains. The COMPQ was higher by .03% and the NDX was off by .03%. The SPX fell .56%. Volume was higher across the board, due to the quadruple expiration. It was higher by 13.05% on the Nasd and 35.13% on the New York. Even though it was mostly due to the expiration day, but it still counts as distribution on the New York averages and stalling on the Nasd averages. Leading stocks outperformed again with the leaders index gaining .74% on the day. The index closed in about the middle of its trading range and made a new high on both a closing and an intraday basis. The relative strength line of the leaders index also made a new high. The reversal we saw yesterday was negative, but the damage was limited. Fears of an increase in Coronavirus cases spooked the market. The increase in volume was due to the expiration, but the distribution count remains modest. The continued outperformance of quality growth stocks is a good sign as the market rarely gets into much trouble when quality growth stocks are outperforming. Yesterday’s reversal was a little unnerving but the overall picture still looks positive. Jerry