The market had a big sell off early in reaction to the unemployment report, but staged a strong rally from that point and ended close to the high of the day, just edging above the low from the previous day. As we wrote in the 4/4/13 report, there has been a change in behavior in the market. The high less low spread on the DJIA was greater than 150 points two times this week, indicating that volatility has been picking up. Volatility often rises before a downturn. On the other hand, lots of people are looking for a downturn, which might minimize the pullback or even hold it off.

HOUSING

On the 3/25 we wrote about the diminished prospects for landlords that are still purchasing single family housing now. The Journal ran an article on this today, Jed Kolko, chief economist for the website Trulia stated “Yesterday’s investors make it harder for tomorrow’s investors to get the yields they want. All the investor activity has boosted prices and added to the rental supply, which has flattened rents.” The article did also talk about markets where the math still seems to work.

GOLD

Gold had a strong day and, after falling through support the last couple of days, rallied back above, indicating a possible false breakdown.