The indices had a very strong rally today after a very weak opening and an early sharp drop. They turned around on a dime, with financials leading the way.

Most of that was attributed to a positive outlook by Meredith Whitney, leading bank analyst, who said she was bullish on Goldman Sachs (GS) and thought Bank of America (BAC) was the cheapest bank out there.

The triggered a strong move in the financials, and a very strong reversal rally in the market.

The Nasdaq 100 reversed from 1402 to close at 1447.70, near the highs for the day going away, up 27.86. The S&P 500 jumped from 875 to over 900, closing at 901.05, up 21.92. The Dow jumped from 8130 to 8330, a 200-point move, up 185 on the day.

It was a significant day for the indices as two layers of overhead resistance were taken out, and half of the entire drop for the last 4 sessions was taken back in just one day.

The technicals supported today’s move. Advance-declines were about 5 to 1 positive on New York and about 19 1/2 to 7 on Nasdaq. Up/down volume was 10 to 1 positive on New York on total volume of about 1.2 billion. Nasdaq traded about 1.9 billion and had a 6 1/2 to 1 positive volume ratio.

TheTechTrader.com board was mostly higher, but there were several fractional losers.

Leading the way on the plus side was Goldman Sachs (GS) up 7.57 at 149.44, JP Morgan (JPM) up 2.37 to 34.71, Morgan Stanley (MS) up 1.97 to 27.91, Wells Fargo (WFC) up 1.93 to 24.80, and Bank of America (BAC) up 1.11 at 12.99.

Other gainers included the OIH oil services ETF, which reversed sharply from under 89 this morning to close at 93.18, up 1.41. The Direxion Financial Bull 3x Shares (FAS) was up 6.35 to 43.81.

On the downside, the Direxion Financial Bear 3x Shares (FAZ) led the way, down 9.62 to 46.73. The Direxion Large Cap Bear 3X Shares (BGZ) lost 2.89 to 37.17, the UltraShort Real Estate ProShares (SRS) 1.83 to 20.92, and the the Direxion Small Cap 3x Bear (TZA) also 1.83 to 24.48.

Stepping back and reviewing the hourly chart patterns, sharply lower early on, and then a very sharp reversal, with the banks leading the way, and then a more muted advance in the afternoon but a steady one, holding support all session and closing at highs for the day going away. The bulls couldn’t have asked for more. Well see what kind of extension they get tomorrow.

Harry Boxer is a technical consultant to many Wall Street hedge funds and large institutional traders, and author of TheTechTrader.com.