The stock market indices suffered a very nasty reversal for Monday and closed not far off the session lows. Only a last 15-minute snapback rally brought the indices off the afternoon spike lows.

But damage was done, and the indices closed lower after a very sharp gap-up at the opening, with new rally highs reaching near 1940 on the Nasdaq 100 and 1131 on the S&P 500. At that point they rolled over in the morning in a 5-wave decline, stabilized midday, tried to bounce back, but when the rally failed at earlier resistance highs, the indices rolled over hard, spiking down in the last hour and a half to reach 1885 NDX and 1108 SPX. However, they did manage to bounce 10 points on the NDX and about 5 points on the SPX to close off the lows.

Net on the day, the Dow was down 8.23 at 10,442.41, closing 150 points off its high. The S&P 500 fell 4.31 to 1113.20, closing 18 points off its high, and the Nasdaq 100 was down 17.64 to 1895.84, about 45 points off its high and 10 points off its low.

Advance/declines moved into the negative column at a little less than 3 to 2 negative on New York Stock Exchange and more than 2 to 1 negative on Nasdaq. Up/down volume was 3 to 2 negative on New York with total volume of just over 1 billion. Nasdaq traded over 1.8 billion and had about a nearly 3 to 1 negative ratio.

As a result of the reversal, a lot of stocks on TheTechTrader.com board moved into the negative column after being sharply higher earlier, but several stocks managed to hold onto gains. The leader on our board was Baidu, Inc. (BIDU), up 2.27 at 77.36, which still was more than 2 points off its high earlier. American International Group, Inc. (AIG) managed to gain 85 cents at 38.76, and new portfolio position Research Frontiers Inc. (REFR) was up 55 cents at 4.25. Those were among the leading gainers.

Other than that there were just small fractional gainers.

On the downside there were just a few point-plus losses. Leading the way was Google down 11.47 at 488.57, Dendreon Corp. (DNDN) 1.72 at 36.83, OmniVision Technologies Inc. (OVTI) 1.09 at 22.31, and Cree Inc. (CREE) 1.43 at 67.78.

In addition, Apple Inc. (AAPL) reversed more than 10 points at one point, but closed down 3.90 after being as high as 279.00, a new all-time high, closing at 270.17. Amazon.com Inc. (AMZN) was down 3.28 at 122.55. Those were the point-plus losers.

Ultra-short ETF Direxion Daily Emrg Mkts Bear 3X Shares (EDZ) lost 2.19 to 40.12.

Stepping back and reviewing the hourly chart patterns, the indices gapped up sharply at the opening, hit new rally highs, and then rolled over steadily for the rest of the session, including a spike-down decline late in the day that was pared back only by a late 15-minute bounce into the close in what appeared to be short covering.

The rally may have aborted today and we're left to see if there's any downside extension going forward. We expect some negative action this week, but we’ll see how far it extends.

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