Jerry Samet
08-02-2016, 06:37 PM
The market sold off today from the open. The major averages were lower all day but a little late rally saw them close off their intraday lows. The COMPQ fell .90% while the SPX lost .64%. Both closed in the lower half of their intraday trading ranges, showing that there was little support for stocks as they fell. Volume was higher across the board and above average on the Nasd so large institutional players were selling stocks today. This was enough to produce a new distribution day on all the major averages. Leading stocks sold off as well with the leaders index declining 1.37% on the session, more than the overall market. The index closed near the lows of the day and is now below the important 17dma. Volume was lower than yesterday and below average so there was no distribution in leading stocks. Breaking the 17dma is a negative event for an index of quality growth stocks. The best stocks rise above this moving average. The chart of the index is looking a bit sloppy on both a price and a relative strength basis. Today was the first really negative session we have had in a few weeks. The rally looks like it is still intact, but there are more negatives out there. We must get back on track pretty quickly. Much more action like this will darken the picture considerably. Jerry