The market opened with solid gains in a continuation of last week’s rally. It continued for about two and a half hours and produced sizable gains. Some selling came in and about half or a little more of the gains were erased. While the higher prices were good the major averages closed at or near the bottom of their intraday trading ranges, due to the gap up at the open. The Nasd averages were the strongest with the COMPQ and the NDX higher by 1.05% and 1.14% respectively. The SPX rallied .47%. Volume was an issue. Esignal had it slightly lower across the board, but the declines were so small that other data sources could come up with different numbers. Leading stocks rallied also and then were hit by selling. The leaders index finished higher by .85% on the day, but selling came in and the index closed low in its trading range. Volume was lower but above average. Today started off strong, but unlike recent trading sessions there were clearly some sellers out there. As prices rose there were market participants willing to part with their shares. The Nasd averages broke nicely above their 50dma resistance but could not hold this important moving average. They closed well below them. The major averages and the leaders did not meet the definition of a stalling day today, but there was a stalling feel to trading today. The first three days after a follow through are important. Any distribution in this time frame usually kills the rally attempt. The next two days will be important. The rally attempt still is on track, but today’s sloppy action is a bit concerning. Jerry
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