The market staged a negative reversal today. The major averages rallied early, but the gains didn’t hold and selling came in. The major averages spent the rest of the session declining and late selling saw all the major averages finish near their intraday trading lows. The final declines were pretty evenly divided with the COMPQ and the NDX falling .64% and .72% respectively. The SPX lost .69%. Volume was mixed. It was higher by 8.37% on the New York and slightly lower by .86% on the Nasd. That produced a new distribution day on the New York averages. Leading stocks were weaker as well with the leaders index falling 1.33% on the day. The index closed low in its trading range on much lower volume. The market tried to rally early but was unable to hold early gains. There was pretty consistent selling after the first couple of hours and all the major averages finished weak. The SPX and the INDU both came close to their respective 50dma’s in the last few days but it looks like they may be turned back at this important moving average. The Nasd averages have not gotten close to this resistance level. The current rally attempt is still valid as recent lows have not been undercut, but the action does not look encouraging and the current weight of the evidence points to lower prices ahead. Jerry
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