The overall market as measured by the Dow Jones Industrial Average lost 484.74 points or approximately 6.2% to finish the week at 7,365.67 I've said it before, and I'll say it again, the single biggest influence on the market is politics. The market obviously did not like what it heard last week with respects to the politicians meddling in the US economy. They passed a so called stimulus plan that contains a higher concentration of pork than a tube of Jimmy Dean sausage, introduced a housing plan that would be laughable if it wasn't such a waste of tax payers dollars, and floated a trial balloon to nationalize 2 of the largest banks in the country. And that was on a holiday shortened week. Amateur hour is what last week was.

The Dow Jones Industrial Average lost another approximately 250 point on the 1st trading day of this week, to close at 7,114.78 The Dow Jones Industrial Average is a measure of the strength and health of the US economy. What the decline in the Dow Jones is telling us is that it is just not the US financial sector that is under pressure, but the entire economy is under pressure. The market participants have lost faith in those in Washington who are charged with correcting the financial system, the massive spending programs coming from Washington are causing the market participants to question the future, and the constant fear mongering from Washington is driving them away from the market. Until this changes, which will probably be sometime around early November 2010, I am expecting the market to continue to move lower. In the short term I am expecting the Dow Jones Industrial Average to continue to move lower and test 7,085.16 and then 6,852.72 on a closing basis. If the support in the 6,800 level fails to hold, then the next level of significant support comes into play at the 5,700 level. The way things are going, I wouldn't be surprised to see the Dow at that level sometime this summer.

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Dow Jones Industrial Average (INDU)

Current Opinion: Closed @ 7,114.78 Last Signal: Called Lower (again) with the close of 8,378.95 on October 24th. Current Expectations: We might see a short term rally however the Dow should continue to move lower and test 7,085.16 and then 6,852.72 on a closing basis.

The S&P 500

Current Opinion: Closed @ 742.33 Last Signal: Called Lower (again) with the close of 876.77 on October 24th. Current Expectations: We might see a short term rally however the S&P 500 should continue to move lower and test 737.65 and then 720.98 on a closing basis.

The NASDAQ 100 (NDX)

Current Opinion: Closed @ 1,128.97 Last Signal: Called Lower (again) with the close of 1,202.27 on October 22nd. Current Expectations: The NDX should continue to move lower and test 1,036.51 on a closing basis.

CBOE Ten Year Treasury Index (TNX)

Current Opinion: Closed @ 2.777% Current Expectations: The TNX should move higher and test 3.027% and then 3.340% on a closing basis.