The market had another fairly solid advance yesterday. Both major averages opened stronger. The COMPQ finished with a gain of .62%. Most of the gain occurred near the open and then it traded pretty much sideways for the rest of the session. It closed in the upper half of it’s intraday trading range. The SPX opened strong as well and closed with a gain of .38%. It saw it’s intraday highs early and worked it’s way lower the rest of the day and closed in the lower half of it’s intraday range. Volume was mixed. Slightly lower on the Nasd and higher on the New York. This combined with the low finish in the SPX produced a stalling distribution day on the SPX. Leading stocks had a positive session as well with the leaders index gaining .78% on the day. The index has a red candle because it closed slightly below the open, but it still finished in the upper half of it’s intraday trading range. The index closed above the important 17dma, a positive sign. It pulled back to it’s 50dma and bounced off it and has had three up days in a row, a good sign. Volume on the index was high and well above average. Much of this was due to extremely high volume in CMG as it fell 12.32% on more E.coli breakouts. Despite this large decline in a component of the index it managed a solid gain. The market seems to want to work it’s way higher, but a high distribution count on both the major averages is a big red flag. You should have positions but should not get to carried away. Using early buy techniques and not buying on traditional breakouts is the best way to go. Jerry
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