Jerry Samet
09-06-2012, 11:24 PM
The major averages followed the leaders index by breaking out today. It seems that the cup and handle pattern overcame a potential double top as all the major averages broke out with gains of 2% or more. Volume increased across the board and was above average on both exchanges. The cause of the pop seemed to be the ECB saying it will buy as many bonds as necessary, but there was real conviction in today's action. The leaders index slightly underperformed the overall market with a 1.26% gain. Volume was both higher and above average and it was the first day of above average volume in 25 trading days. Both the major averages and leading stocks are acting well. The MEM is fully invested and the distribution day count is low. The rally appears to be on solid ground. Jerry