This is a weekly audio/video commentary of the market focusing on several aspects of the current market's development and upcoming expectations based upon the market's current action.

October 21, 2007

Good morning! The market took quite a plunge on Friday on the 20th anniversary of Black Monday after teasing about such a move for several weeks. On both Wednesday and the previous Thursday the markets had experienced sharp intraday selloffs, but in both cases the indices managed to recover rather well. On Friday, however, the downside pace increased dramatically and key daily support levels gave way. The Dow Jones Industrial Average led the decliners by rounding off at the daily highs over the course of the past several weeks and then slowly beginning to sell off with last Thursday's steep reversal. At the same time, the Nasdaq Composite had managed to hang onto most of its gains and base at highs, but it was unable to sustain any of the intraday momentum on the upside. Even though it continued to hold the 20 day simple moving average support into Friday, it has broken the uptrend channel line from the buying which had been in place since mid-August.

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