The market followed a familiar pattern today. After opening strong the major averages saw their intraday trading highs early and spent the rest of the session selling off. All the major averages finished at their lows of the day, a sign of weakness. The COMPQ closed with a loss of .28% while the SPX fell .41%. Volume was mixed, higher on the Nasd and lower on the New York. This was enough to produce a new distribution day on the Nasd averages. Leading stocks were lackluster as well with the leaders index declining .28% on higher and above average volume. The index also closed low in its trading range and is sitting right on its important 50dma. I have said before that the greater the number of times a stock of index test support the greater the chance it will break that support. The leaders index has been testing the 50dma a lot recently. Volume on the index rose and was above average, showing distribution in quality growth stocks. The market looks a little soggy right now. We are seeing a pattern of early strength and late weakness ,not usually associated with a bullish environment. The charts of the major averages all still look good, but the same can’t be said for a large number of leading growth stocks. An uncomfortable number of them as rolling over and giving clear sell signals. Calling market tops has been a futile game for a long time now and I have been wrong before, so I won’t call one now, but the market feels a little weak right now. Jerry
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