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In Tuesday's column I talked about how the Dow Jones Industrial Average was still suggesting somewhat lower levels, as its Fibonacci .382 retracement of the rally off the June lows (the low for 2012) weighed in at 13,040.45. As I explained then, a pullback to that level should have come as no surprise and likely represented a buying opportunity. Wednesday's low in the Dow of 13,063.63 was still about 23 points shy, so, following this morning's gap-up opening, there were at least two good reasons to expect a pullback. First, there was the opening gap, which was just begging to be filled. That gap was at 13,077 and was filled after the early pop to 13,164. Then there was the completion of the .382 retracement level of the rally off the June lows. That, of course, was at 13,040.45. The low, just before noon EDT, was 13,039.86, which was an undercut of this level by less than two-thirds of a point. From there, the Dow rebounded almost 60 points before pulling back again. Now we'll see if this level continues to hold. As suggested in Tuesday's column, I was a buyer as the Dow tagged its .382 retracement. In this case, buy the DIA December 129 calls.

I was also keeping an eye on the S&P 500 this morning as it flirted with its Sept. 6 gap, which I also discussed Tuesday. That gap is at 1403.44. The low this morning was close, 1405.14, less than two points away. But the gap hasn't been filled yet, and I still have to allow for that possibility. Below that is the .382 level of the S&P 500 at 1395, another target area I cannot rule out....380 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.