Jerry Samet
05-14-2016, 12:48 PM
The markets sold off at the open and after a weak rally attempt a couple of hours into trading the major averages resumed their decline and continued lower the rest of the day. The COMPQ finished with a decline of .41% while the SPX fell .85%. All the major averages finished the session at or very near their intraday trading lows, a sign of a lack of buying support. Volume was lower across the board so there was no distribution in yesterday’s action. Leading stocks sold off as well with the leaders index falling .71%. It closed near it’s intraday lows on much lower and below average volume, so there was no distribution here either. The index is moving further below it’s important moving averages. The 9dma and 17dma are now below the 50dma and the index looks like it is going to break below the consolidation range it has been in for several weeks. The index, after breaking below it’s 50dma made an attempt to climb above it but now it looks like that attempt is failing. The New York averages, which have been the strongest recently are now selling off the most. All the New York averages broke below their respective 50dma’s yesterday, joining the Nasd averages below this important moving average. It is looking like the rally that started on 2/11 is in real danger of failing. It was a weak, struggling rally to begin with and few trading opportunities producing worthwhile profits. A pattern of lower highs and lower lows is shaping up in the charts of the major averages. The market is not broken yet, but it looks like it is headed in that direction. Jerry