Leaders Index 9-9-14

It was a pretty ugly day for the market. The open was mixed with the Nasd averages higher, mostly on strength in AAPL before it’s announcement, and weakness in the New York averages. A reversal saw the major averages turn lower with particular weakness in the last two hours. The COMPQ led the way lower with a loss of .87% while the SPY lost .65%. They both closed at their lows of the day, a bad sign. Volume was higher across the board so there was distribution on all the major averages. Leading stocks got hit worse than the overall market with the leaders index falling 3.03% on higher but slightly below average volume. Much of the large decline was caused by large declines in Chinese stocks, particularly BITA and CMCM, but more and more stocks in the index are showing worsening chart patterns. The index closed below it’s important 17dma, the first time it has closed below this moving average since the rally started. The market is starting to show the first real signs of cracking since we began the current up trend. We must see some solid advances on good volume to show that big institutional investors are not abandoning the market. If that doesn’t materialize the rally could be showing signs of real trouble. Jerry