Jerry Samet
03-17-2016, 10:54 PM
It was another positive session today. The market opened the day lower, but after less than an hour of trading they reversed and spent the rest of the day rallying. A little late weakness saw the major averages finish off their highs but still very high in their intraday trading ranges. The COMPQ finished the day with a gain of only .23% while the SPX rallied .66%. Volume was again higher than yesterday, but still well below average. Large institutional players were buyers, but not with much conviction. Leading stocks did better than the overall market with the leaders index higher by 1.36% on more volume, but it was still well below average. The index finally broke above the consolidation pattern that it has been in for the last couple of weeks, which is positive. It would have been better if the volume were higher. There has not been above average volume on the index since the follow through on 2/17, a full month ago. The charts of the major averages are looking better as more retake their important 200dma’s. The problem is that most of the gains are coming from defensive names and beaten down stocks. The are more breakouts showing up, but they are not producing worthwhile gains. Most are stalling after they break out. Even early buys are not doing much. The central banks are again causing stocks to rally as they continue to print massive amounts of money, or in the Fed’s case refusing to tighten. This is the most difficult market to make progress in that I have ever seen as most or all of the rules that have worked for decades are being distorted by the action of the central banks. For now the easiest way to make even modest progress seems to be in index ETFs. Jerry