Underlying momentum gauges argue that the weakness in the Lehman 20-Year T-Bond ETF (TLT) is corrective, which should resolve to the upside and propel prices towards a test of the prior high at 96.36.

In terms of real money – gold – oil is still cheap. Then again, in terms of real oil, gold is cheap . In terms of anything real, everything else is realistic. In terms of gold, the ordinary American house is cheaper today than it was five years ago. In terms of oil, the average stock is barely half what it was five years ago. In terms of soybeans, even health insurance is a bargain.

AUD/USD appears to be picking up pace to target Fibonacci resistance at 0.8900, and could rally to parity with the US dollar.

US economic data has not fared well as we enter 2008, as last week’s dismal non-farm payrolls reading of 18,000 and jump in the unemployment rate to a two-year high of 5.00 percent points toward a gloomy scenario.

Heading into the remainder of the week, Toni Hansen is expecting some more corrective action. That can create some very nice back and forth moves on the 15- and 30-minute time frames which will make for favorable daytrading conditions.

It appears that the economy is headed towards the dreaded synthesis of inflation and deflation known as ‘stagflation.’ Gold is rising. Oil has already risen. Up, up, up and yet, the economy can barely get out of bed in the morning. Consumers are running out of money to spend. And financial assets are going down instead.

With the "umph" behind the QQQQ appearing to be missing, Mike Paulenoff continues to look for another loop to the downside that retests and likely breaks this morning's low.

The number of Americans entering into contracts to buy previously owned homes during the month could prove to be more disappointing than expected, and prices of existing homes, which make up about 85 percent of the US housing market, likely have much further to fall.

James Mound writes that the coming year will see a strong U.S. dollar and global economic weakness force a recession in commodity prices, sparking a long overdue price correction in many major commodity sectors.

The market now is looking even lower, although as we head into the new week we do have price support that can stall the breakdown for a few days.