The market rallied today following yesterday’s late strength. After a strong open the major averages saw a little selling and went into negative territory before they rallied into the close. All the major averages finished at or very near their intraday trading highs. The Nasd averages were the strongest today as the big cap tech stocks rallied. The COMPQ and the NDX gained 1.71% and 1.88% respectively. The SPX was higher by 1.05%. Volume was lower across the board. It fell 18.21% on the New York and 10.15% on the Nasd. This shows that there was not a lot of buying pressure in the positive action today. Leading stocks rallied as well with the leaders index gaining 1.54% on the day. The index closed near the top of its trading range and it is now above all its short term moving averages. Volume was lower and just below average. The relative strength line of the index is getting close to its old high. The market acted well today, but the volume was lacking. The light volume shows that large institutional players were not heavy buyers today, and they are needed to produce a sustainable move. The day’s action was generally good. Quality growth stocks seem to be acting a little better. The relative strength line of the leaders index is just below its old high. A move into new high ground would show that leading stocks are outperforming the overall market, a very good sign. The Nasd averages are almost right at their 50 day moving averages. A break above this resistance, particularly on heavy volume would show that the bulls are regaining the upper hand. Right now the market still has a lot of work to do to improve the picture and overall I would still say the odds favor lower prices, but more positive action in the next few days could change that. Jerry
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