A last hour rally saved the indices and brought them back from the abyss, as the indices were at the lows for the day with just an hour to go and it was looking like another ugly close. But the deeply oversold intraday condition resulted in a late snapback rally that I'm sure was fueled by short covering as well.

The day was volatile in the morning. They came down hard early on, snapped back hard as well, failed at resistance and made lower lows on the Nasdaq 100 but failed to do so on the S&P. Then they rallied mid-day and fell short of the earlier highs and then sold off steadily from mid-day until late afternoon.

The Nasdaq 100 dipped under 1720 to 1716.52 before a sharp rally brought them back to 1734 at the close. The S&P 500 tested 1320, closing at 1331 1/2. Net on the day the Dow was down 7.5, the S&P 500 up 0.7, and the Nasdaq 100 down 12. But all of those were sharply off their lows. The Philadelphia Semiconductor Index (SOXX) was down 2.55 today.

The technicals did not make it back into the plus column by any means, with about 235 more decliners than advancers on New York and about 800 more on Nasdaq. Nasdaq had about a 2 to 1 negative ratio. Up/down volume was just 8 to 7 negative on New York with more than 1.5 billion traded. Nasdaq traded about 2.15 billion with a 13 to 8 negative ratio.

TheTechTrader.com board was very mixed but had an edge to the downside today. Cepheid (CPHD) fell 3.32 on top of last week's losses. China Natural Resources (CHNR) was down 2.13, China Finance Online (JRJC) 2.27, and Sigma Designs (SIGM) fell another 2.75 to close at 26.72. That's off from 73 in late December.

Other point-plus losers included ABK off 1.20, WM 1.15 and MBI down 35 cents in a weak financial services sector. DryShips (DRYS) lost 1.56, but Excel Maritime (EXM) and TBS International (TBSI) were near flat on the session in the shipping sector.

Cree Inc. (CREE) lost 1.27, and there were several other large fractional losses as well.

On the plus side, gainers included Converted Organics (COIN), with incredibly strong relative strength of late, gaining 1.94 to a new all-time high at 14.74 today, on 3 1/2 million shares.

Also on the plus side, Mercadolibre (MELI) was up another 1.44, although that was about 2 points off its session high. UEPS, getting back over 30, closed at 30.05, up 95 cents.

Stepping back and reviewing the hourly chart patterns, the indices continued lower in distinct down-channels, particularly on the Nasdaq 100, and when the bottom of that channel was hit they bounced sharply off that level.

The S&P 500, in a different configuration, barely made new lows in the afternoon, and now has a "W"-type bottom pattern potentially.

We'll see if that equates to anything over the next couple sessions. Key resistance is now 1335 and then 1340-42 on the S&P 500, and 1744-46 and 1755 on the NDX.

Harry Boxer is a technical consultant to many Wall Street hedge funds and large institutional traders, and author of TheTechTrader.com, a real-time diary of his day, swing and intermediate-term trades. For more of Harry Boxer, sign up for a free 15-day trial to his Real-Time Technical Trading Diary, or sign up for a free 30-day trial to his Top Charts of the Week service.