The market traded in negative territory most of the session, but the losses were less than yesterday’s gains. After opening lower the major averages rallied a bit but sold off into the close. All the major averages finished at their intraday trading lows, a sign of a lack of support. The COMPQ finished with a loss of .36% while the SPX declined .55%. Volume was lower across the board, which is want to see after a follow through. This means that there was no distribution today. Leading stocks were lower as well with the leaders index lower by .52% on the day. It closed low in its trading range, but the lows of the day were still above the short term 9dma support level. Volume on the leaders index was lower than yesterday and slightly above average. The action of the market today would have to be described as mildly positive. The major averages held on to most of yesterday’s gains. The real key to the overall positive action today was volume. It was lower on both exchanges, which allowed the major averages to avoid a distribution day. Distribution in the first three days after a follow through usually kills the rally attempt. The fact that there was none today is encouraging. The close at the bottom of the trading range and a light crop of fresh breakouts is some cause for concern, but so far the rally attempt is doing ok. Jerry
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