The markets had a huge start to the week and closed at the highs for the day going away.

The day started out with a move up off of higher futures. Then they rolled over and came down rather sharply after the first hour, but held support and moved up steadily into the lunch hour.  At that point the market went sideways and consolidated in a three-hour flag pattern.  In the last hour or the indices broke out and ran hard into close.

The Dow was up 170, the S&P up just under 20, and the NDX up more than 25 1/2.  The SOX Index managed to advance 5 points after being down much of the morning and early afternoon.

The technicals were very positive by better than 3 to 1 on New York and a little less than that on Nasdaq.  Total volume was a bit lower than recent sessions, with 1.5 billion on both exchanges.  Up/down volume was 4 to 1 positive on Nasdaq and about 6 to 1 positive on New York.

TheTechTrader.com board was mostly higher, led today by Rediff.com India (REDF), which had an excellent earnings report.  It was up 4.23 to 19.35 on 4.2 million, the highest volume in many months.

Energy Conversion Devices (ENER) popped 1.85 on nearly 1 million shares traded.  Vertex Pharmaceuticals (VRTX) was up 1.14, Taser (TASR) 1.06 on 14 million shares, Dynamic Materials (BOOM) up 80 cents, Broadcom (BRCM) 80 cents,  Kendle International (KNDL) 78 cents, recent Chart of the Week Neoware (NWRE) 73 cents, and low-priced Internet play Sify Inc. (SIFY) up 80 cents.

On the downside, Convera (CNVR) was off 48 cents, but the only other losing stocks were off very small fractions.

Stepping back and reviewing the overall patterns, the market had a very convincing up-day.  Despite the fact that volume wasn't as heavy as I would like to have seen, the technicals and price action were strong, and they closed as indicated going away at the highs for the day.

The S&P had a key breakout the end of the session, taking out last week's rally high of 1197, closing at 1199, but the 1199-2000 zone still has some price resistance here.  It'll be interesting to see if they can take that out and move up to higher levels.

The NDX had a nice follow-up session as well, and took out 2-3 layers of resistance.  The levels we'll be watching tomorrow are the 1600-04 zone the Nasdaq 100 and the 1205-08 zone on the S&P.

Good trading!

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.