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The market attracted some pretty good overall interest since the gap down early yesterday morning. We provided a range for the NDX yesterday between 2590 and 2550 suggesting that's where this market was going to find a short-term base, and sure enough once the NDX broke through 2590, a significant amount of interest came plowing into the major indexes. I've included an hourly bar chart here of the NDX showing you what I refer to as a wash and rinse. The extreme move down followed by a strong move up and a repeat of that action is a classic wash and rinse, which usually suggests a short-term bottom at the very least.

The only thing you should keep a watchful eye for is a break below that support level that the NDX has tried to put in since early yesterday. It's possible the NDX could catch traders by surprise with a sharp move down again but I suspect if the NDX attempts to make that move, it will likely be met with a fairly strong snapback.

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Hope you all had a great weekend. If you're a horse racing fan, our Kentucky Oaks and Kentucky Derby picks we gave you on Friday were close but no cigar. Yea I know, close only counts in horseshoes, no pun intended. Two out of three of our Oaks picks ran 3^rd and 4^th while two out of three of our Derby picks ran 2^nd and 4^th. Respectable to say the least but not good enough. What makes it even more frustrating is I had insider info that "I'll Have Another" was going to run a big race on Saturday but just didn't choose to believe the source. Guess I've got a little egg on my face because right after he won the Derby on Saturday, my first thought was... wow, I'll have another. Oh well, next year!

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I'd say good Friday but the truth is I haven't seen a gap down this ugly in quite some time but it most definitely doesn't come as a surprise. We've been making it pretty clear ever since we called this selloff that the rallies couldn't be trusted and last week's short-term bounce again only proved to be an opportunity for short sellers to open favorable entries. The good news is, we're at a level now that could potentially allow the major indexes an opportunity to find a solid base. However, that's yet to be determined.