It was another generally negative session yesterday. The day started off in positive territory when news of a renewed FBI investigation of Clinton caused a sell off. The major averages recovered a little of their intraday trading lows but still closed near their lows. Volume was lower across the board so there was no new distribution on the day. Leading stocks were higher on the session with the leaders index gaining .55% on the day. The index closed right on it’s now flattened out 50dma, but finished in the lower half of it’s intraday range. Volume on the leaders index was much higher than Thursday and well above average. The index is now sitting on important support. How it reacts at this level will tell us a lot about the future direction of the market. The overall picture is looking pretty bad right now. All the major averages are trading below either flat or declining 50dma’s. We are also seeing a pattern of lower highs and lower lows developing in the charts. Quality growth stocks are showing cracks as many if not most of the leaders of this rally are breaking down. There were a few good looking breakouts yesterday in stocks like ELLI, AZPN and LOGM. How these stocks trade after their breakouts will be telling. Jerry
Reply With Quote