Leaders Index 7-9

The market had another rally day today as the major averages continue to drift higher. They cleared marked highs and are approaching their recent highs. Volume was mixed, rising on the Nasd and lower on the New York. There still has been little conviction as almost all the high volume days have been on the down side. Leading stocks had a pretty good day and outperformed the overall market. The leaders index rose 1.83% on higher but still slightly below average volume. It cleared it’s 50dma, which is a major hurdle, but there have been no up days on above average volume since the rally attempt began eleven days ago. The major averages are very close to their recent highs, which would trigger a new uptrend in IBD and turn on the buy switch in the market school model. The market seems to want to go higher and will likely trigger buys soon. There has been little conviction in the rally and many of the stocks that have broken out have done so on weak volume. It is ok to play the rally, especially if we move to new highs, but until there is real volume on the up side some caution is warranted. Jerry