The market continued its negative action today. After opening higher the major averages soon started selling off and after a weak rally attempt went lower into the close. All the major averages finished pretty much at their intraday trading lows. The COMPQ and the NDX fell 1.15% and 1.07% respectively. The SPX declined .97%. Volume was mixed. It fell 6.26% on the Nasd and increased 2.52% on the New York. This shows distribution on the New York averages. Leading stocks were hit hard again today. The leaders index fell 3.15% on the day. The index closed low in its trading range and moved further below its 50dma. Volume was about flat and the relative strength line of the leaders index broke below its 50dma. The market continued its corrective action today. The strong open and weak close is indicative of a market that wants to go lower. The Nasd averages moved further below their 200dma’s. Leading stocks are doing worse than the overall market as former leaders break down in large numbers. This is also a sign of a weak market. The COMPQ is also now down 10% from its high and will likely go into a full intermediate correction. We are getting into the thick of the earnings season and so far the results have been disappointing. Next week will see many important companies reporting and a Fed meeting. It clearly looks like there will be an intermediate correction, the question now is if it will develop into something more. There will be no updates tomorrow or Friday. Jerry
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