Good Wednesday to you. We're again seeing some nice follow through in the markets today. For the short-term, it appears that break below 2500 on the NDX we suggested late last week is proving to be a catalyst for at least a decent short-term relief rally. We also suggested that the recent 3/8 retracement of the S&P and DOW may provide at least a short-term catalyst for this market to move higher, and so far that's been the case. Advertisement Why are "801k Plans" Restricted from Being Advertised? These "801(k) Plans" - which have no age, income, or employment requirements - grow your money up to four or five times faster than traditional 401(k)s or IRAs. But it's unlikely you've ever heard about these special programs before: The U.S. government has placed restrictions on advertising them to the general Click here to learn why. Advertisement Congrats to those who decided to pick up some call options on the QQQ's extending out four to six months. You're likely well in the money today. However, although we'll take the strength we're seeing in the markets over the last few days with open arms, there's still plenty of work to do for this market to prove that we've put in a bottom we can work with now for this market to go much higher. So if you did get long the Q's, I'd start thinking about handing those back as the NDX moves toward 2577. Why? In my opinion, the real test of this market is going to be what happens with the NDX between 2577 and 2613 because that's likely going to be the most logical point for short-term short sellers to get back in, fade the rally in anticipation of the markets moving back lower once again. 2577 represents the 3X3 DMA number on the weekly chart and 2613 represents the 25X5 on the daily. Since the market has been in a short-term bearish trend, that's going to be where the battle for higher or lower levels takes place. I suspect once we reach those levels, we'll see a pullback. As a matter of fact, until the NDX manages to work its way back up above 2661, anything can happen. Therefore, I'm not going to overly speculate right now short-term that we'll fail or break above those key levels. However, I've got what I consider to be some interesting commentary from a longer-term perspective that suggests that this market has priced in just about everything that could go wrong based on what the general media has continued to cry about. Although we've said since day one that the top of April and the pullback we're seeing has been about as logical as logical can be, the media has led everyone to believe that Greece is imploding and Spain is next. Now, all of a sudden if none of those things end up happening, the market is going to be surprised and will likely start grinding higher. It's important to remember that the media is the general driver of short-term sentiment. All of the news pundits pointing to doom and gloom (that's what creates ratings) inevitably ends up pricing enough fear into the market to the point where if none or only one of those things happen, the market has already absorbed the worst case scenario thus allowing the smart money to take it higher. Remember when we were at the maximum point of pessimism back in early '09? The media was pitching the next coming of the great depression. What happened? The market started moving higher even before the economic data revealed itself simply because the worst case scenario was already priced in. I don't want to get into a political debate here but let's face it... Wall Street wants Obama out. Walker's overwhelming recall victory in Wisconsin last evening points to Obama not being such a shoe in for his effort to get re-elected in November. Right now, the Street is loving last night's results. Whether it's real or not, the perception is maybe there's a light at the end of the tunnel to bring old-fashioned capitalism back to the markets. Even when reality isn't the case, perception can be more than enough to make you some serious money in the markets. My bottom line point to all of this is any unexpected good news coming from anywhere is going to likely take this market higher. I'm sure you've heard the old adage, buy the rumor, sell the news, right? Well that works the same when a stock or the markets are going south... sell the rumor and buy the news. Even if Spain or Greece come out with not so shocking news that the sky is falling, that move lower in the market would likely be some sort of bottom. Know what I mean? I saved the best for last. As you know, not only do we hold a lot of credence to fundamentals, we're obviously huge fans of charts, especially when trying to get a feel for the long-term picture. I've included a monthly chart here of the NDX dating all the way back to 2000 when the Internet Bubble imploded. Boy was that fun. Not. It was the wild wild west for those of you who weren't in the markets back then. Anyhow, I'm giving you a look at this chart simply because there's a few things that excite me from a technical perspective in regards to the overall markets for the long haul. Back in October of '07, the NDX had finally retraced almost 3/8 of its move down that started back in 2000. We all know what happened after that, the great recession or whatever you want to call it. Once the market managed to find a bottom in the spring of '09, the NDX ran again finally achieving a complete 3/8 retracement that continued to be tested and met with pressure throughout 2011. This is where things start to get exciting. The recent run that started late last year all the way up until April of this year had finally broken above that 3/8 level in convincing fashion and now appears to be headed for the 5/8 level which would put the NDX at roughly 3264!! Now don't get me wrong, we're not going there in a straight line. It may take quite some time to get there but I assure you, we're going to get there unless the whole world implodes and there's even people out there that think 2012 is the year the world implodes. Good luck with that. Sometimes when you take a huge step back and look at the history of the markets, you'll discover that all of the crazy B.S. that takes place in the media is nothing but just that. An objective look at the big picture without all of the noise can often provide the necessary comfort to put money to work in the market for the long-term knowing you're going to generate better returns in stocks than anywhere else you can invest as long as you're picking the right ones. Even if you didn't know or want to pick stocks and just bought major index ETF's at logical retracement levels over extended periods of time, you'd likely outperform the S&P without ever having to invest in a single stock. Whether it's five years from now or even ten years from now, this market is likely going much higher. You heard it here first and when speculative money starts pouring back into small caps, you'll know we are well on our way toward achieving that 5/8 retracement level on the NDX of 3264. There's an awful lot of money to be made from here to there, so make sure you're one of the savvy who keeps things in perspective.