Editor's Note:

The S&P 500's drop to the 1300 level is a -3% pull back. Is that enough to satisfy the market's need for profit taking as we watch the Libya self-destruct on TV? Almost anything consumer-related was hammered lower as investors worry about higher oil prices and the impact filling up our gas tanks will have on consumer spending.

Technically the S&P 500 should have some support at the 1300 level and the NASDAQ composite is testing potential support near 2700 and its 50-dma. Thus this would appear to be a buy-the-dip entry point but if you do jump in I would use small positions and tight stop losses.

No new plays tonight. I'm still out of the office and will be back for a normal weekend newsletter.

- James