US Markets - May 11, 2010

When I said back in March when the DJIA gets beneath 10600 we would erase most of the gains for 2010 in short order...I did not expect it to happen in a matter of minutes. At one point nearly eight months of gains were eroded. We will need to retest the 9800 area with conviction and then the "Buffett Blunder" of 9600. If 9600 fails...we will quickly head toward 8000 to retest the July 09 lows. Europe - to try and correct a problem that took years to develop in a matter of a weekend is foolhardy. The more government intervenes, the more things get screwed up. As the markets come to realize this, faith in government erodes and hope is lost. 2010 still remains the year of the dollar. Target-90. Unfortunately for the US, the contagion will come to spread to the US as well. I am still perplexed with gold. Gold is either making a double top here and will initially retrace back toward the $800 area or is on its way to new highs, toward $1500. Still looking for a weekly close below 10600...to confirm last week was not an anomaly. Good luck and good trading. -Dio.