Jerry Samet
08-24-2013, 12:17 PM
The market rallied again on Friday with the major averages rising between .39% on the SPY and .52% on the COMPQ. Volume was higher across the board, but this was not hard due to lower volume Thursday caused by the Nasd outage. Total volume was still well below average and will likely remain so next week until after the Labor Day holiday is past. Leading stocks had a better session than the overall market as the leaders index rose 1.58% on higher but still below average volume. This took the index above it’s important 17dma. This is a positive sign as it shows quality stocks are recovering from the sell off. The RS line of the leaders index has moved into new high ground, showing that many leading stocks have held up well during the correction and are moving higher. The SPY is still trading around it’s 50dma and it would be a good sign if it could clear this important moving average with conviction. The situation has improved in the last couple of days and some quality stocks such as LNKD, TSLA, NFLX and FB are acting well. We are far from out of the woods, but the picture has improved somewhat. Caution is still important, but we must be on the look put for a possible FTD starting next week. Jerry