Friday, January 08, 2010

Midday Briefing for January 8th: Narrowing Rally Continues

Sentiment, as measured by cumulative volume transacted at the market offer vs. bid (bottom of chart, blue arrow), has been positive through the day session and we've remained above VWAP for most of the session. We've been unable to punch through the overnight highs, however, as mixed sector performance has limited the upside. As a result, we've built volume around the 1137 area identified at the start of the session, making that a key level for gauging market moves for the remainder of the day.

For the second day in a row, new 20-day highs are running below 2000, as we are seeing a narrower base to market strength. Note, for instance, that advancing stocks only lead decliners at this juncture today by about 100 issues. All in all, action more consistent with range trade than trending action.