Today was a very good session. The market opened strong and climbed for the rest of the day. Late strength saw all the major averages finish at their intraday highs. The COMPQ led the way higher with a gain of 1.75% while the SPY was up by 1.19%. Volume was higher across the board in what was clearly buying by large institutional players. Even the small caps that were hit the hardest in the decline rallied hard. The RUT was up by 2.86%, getting back above it’s 50 and 200 dma’s in the same session. Leading stocks had a good day as well with the leaders index up by 1.60% on much higher and above average volume. The index made new highs on both a price and a relative strength basis. There continue to be fresh breakouts while stocks that have already broken out moved to new highs. This is positive action as quality growth stocks are acting well. I said that the next thing to watch would be the 50dma’s on the major averages and how they behaved at this important moving average. Today they broke above this level with real conviction, just what we needed to improve the picture. We have now had two follow through like days after the original follow through just over a week ago. The case for the bulls is getting stronger and it is looking like this will be a tradable rally. Jerry
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