Market Summary

The monthly Non-Farm Payroll (Jobs) report was released on Friday at 8:30AM before the market open so that the futures traders could sell off the market before the open and produce a gap open lower to the downside. The market had turned up after the long weekend holiday only to turn back down with the strong sell off Friday. Former Labor Secretary Robert Reich posted on his blog here that we're falling into a double-dip recession. Jobs creation is falling behind population growth which requires at least a 100,000 new jobs a month to keep up with population growth. Short term sentiment again turned bearish. Intermediate and long term sentiment also remain bearish. It appears that we have entered a 5th wave to the downside on the daily chart, although it is possible that what appears as a 5th wave could indeed be a continuation of the 3rd wave to the downside and that would be very bearish. What is particularly ominous at this time is the potential for this turn in the market where it is rolling over to be the beginning of a weekly 3rd wave to the downside. We have made new closing lows for the year in many markets. Click on image to enlarge.

The US dollar via UUP and gold via GLD are the only two listed funds that are up for the year. What this means is that there is deflating prices in most markets and that is not a good sign for the economy. Should we fall into a deflationary cycle even gold could lose some of its glitter as the dollar moves higher due to European debt worries. Click on table to enlarge.