The market put in an encouraging positive reversal today. The major averages opened lower and it looked like there could be some further decline. They put in their lows of the session in the first five minutes of trading and rallied steadily from there. There was consistent buying for most of the day and late strength saw all the major averages finish at their intraday trading highs, a sign of support. The Nasd averages were the strongest with the COMPQ and the NDX gaining .56% and .62% respectively. The SPX rallied .35%. Volume was higher across the board, gaining 5.91% on the Nasd and 4.03% on the New York. Leading stocks gained ground as well, but not as much as the overall market. The new leaders index gained .29% on the day and closed near the top of its trading range. This was a new high on both a closing and an intraday basis. Volume was lower and below average. The action of the market since Friday has been pretty good. Friday’s decline was pretty contained and today we got early weakness followed by a positive reversal. Volume was higher, just what you want to see when the market reverses higher. The new leaders index continues to rally above its 9dma and looks strong. These are some of the best and strongest stocks and should give us a solid clue that the market is in trouble when it rolls over. Right now there is no sign of that. In the situation we face right now any real escalation of hostilities could cause a larger decline in the market, but right now the rally appears to be on solid ground. jerry
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