With the market a bit extended and resistance levels near, it’s most likely looking for any excuse to pull back.  What’s important is how orderly and the amount of selling volume that accompanies any consolidation/pull back.  Today, we are getting some orderly profit taking as volume is currently well below average levels and lighter than yesterday.  Here are the numbers for the major indices as of 1PM EST:

(Note: volume averages are based on the average over the past 50 days)

Nasdaq: down 1.2% today with volume currently tracking 1% GREATER than average
Nasdaq ETF (QQQQ): down 1.39%, volume 22% BELOW average
Dow: down .35%, volume 20% BELOW average
Dow ETF (DIA): down .43%, volume 37% BELOW the average
S&P ETF (SPY): down .67%, volume 32% BELOW the average
Russell Small Cap ETF (IWM): down 1.78%, volume 27% BELOW the average

Leading stocks that make up the SelfInvestors Breakout Tracker database are fairing well today despite a more than 3:1 ratio of Decliners vs. Advancers.  Leading stocks that are moving are moving with volume, while those that are declining are declining with mild volume.

* Decliners are outpacing Advancers 336 to 53.
* Advancers are up 1.3% today and volume is good at 28% ABOVE the average
* Decliners are down 1.86%, but the good news is that volume is light at 11% BELOW average.
* The total SI Leading Stocks Index is down 1.43% today with volume 5% below the average

* Where’s the Money Flowing *

Many websites just provide leading industries based on price performance alone.. without the volume, this can be misleading.  The only way that I know of to guage industry/sector strength WITH volume levels is through the analysis of ETF’s.  A couple years ago this was not possible, but as more traders/investors use ETF’s they become a much better tool for guaging the health of the market and seeing where the money is flowing (or not flowing).  Using the proprietary SelfInvestors Demand Indicator score which measures price and volume movements, I’m able to quickly see which sectors/industries are seeing the greatest inflows of cash. 

* Leading Sectors/Industries – Pharma, Financial, Nanotech, Health Care, Telecom
* Lagging Sectors/Industries – Transports, Oil Services, Home Builders

* There are no significant sector/industry moves up today
* Homebuilders, Semis, Water, Global Energy and Broadband is getting hit today

** Stocks **

This area still under development, but you may like to have a  look at the latest post over at the blog which highlights a few of the top breakout stocks in the SelfInvestors database

http://investing.typepad.com/tradingstocks/2006/09/selfinvestors_l.html