The market had its first overall negative session since the follow through. The major averages put in their highs of the session early it was mostly lower from there. The Nasd averages took the brunt of it as there was weakness in growth stocks in general and big cap tech stocks in particular. The COMPQ and the NDX lost .82% and .87% respectively. The SPX was lower by .11%. The Nasd averages closed low in their intraday trading ranges while the New York averages finished in the upper half of their trading ranges. Volume was higher across the board. It gained 17.90% on the Nasd and 4.20% on the New York. This was enough to produce the first distribution day of the new rally on the Nasd averages. The decline in the SPX was to small to qualify as distribution. Leading stocks were generally lower on the day with the ETF’s of quality growth stocks mostly lower. The leaders index did a little better and showed a slight gain of .03%. The index closed high in its trading range and held its short term 9dma support level. Volume was lower and below average, showing moderate selling pressure in quality growth stocks. The market had its first distribution since the rally began on 10/14. This was caused by weakness in large cap tech stocks. The damage was pretty small overall and the charts of both the major averages and the leaders index still look solid. It was more than a week into the rally that the first distribution occurred and that is encouraging. Overall the damage done yesterday was mild and isn’t anything to get concerned about. The earnings season get into full gear next week with a good number of the big cap tech stocks reporting earnings. That will set the tone for trading next week, but right now the rally seems to be on track. Jerry
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