The indices started off the week on a down note.  Even though they opened slightly firm, they dropped immediately and had a fairly sharp sell-off in the morning, which tested initial support.  They bounced on the NDX and on the S&P 500, but the rally, particularly on the S&P, was rather unenthusiastic.

When they got to the initial resistance level, they failed there and sold off and made lower lows.  Despite a mid-afternoon bounce, they then rolled over again towards the end of the day and closed near the lows for the session.

Net on the day the Dow was down 41, the S&P 10 3/4, the NDX lost 16 2/3 and the SOX was down a little less than 6 points.

It was a decidedly negative day technically, with advance-declines a little bit more than 2 to 1 negative on New York and about 22 to 9 negative on Nasdaq.  Up/down volume was even worse, with a little less than 3 to 1 negative ratio on New York on total volume of a little less than 1 1/2 billion.  Nasdaq traded about 1.6 billion with about a 2 1/2 to 1 negative ratio there.

TheTechTrader.com board was mixed.  On the plus side, Neoware (NWRE), one of our Charts of the Week, had a superior day today, broke multi-year highs, and closed at 22.60, up 1.50.

There were very few other advancers of more than a few cents.  They included UTStarcom (UTSI), up 49 cents on more than 5 million.

Recent Chart of the Week Radvision (RVSN) was up 38 cents, and Astea International (ATEA) up 44 cents.

On the downside, Energy Conversion Devices (ENER) gave back 1.86, Forward Industries (FORD) 1, and Dynamic Materials (BOOM) 98 cents. Those were the leading losers on my board.

Stepping back and reviewing the hourly index chart patterns, the indices pulled back on the hourly charts and tested trendlines and moving averages, and closed right near them on the Nasdaq 100 and just above them on the S&P 500.

So we have some additional testing to do and perhaps lower levels over the next day or two, retrenching from an overbought condition and a market that has advanced smartly over the last few weeks. 

Today's pullback was not a surprise, but unless it extends beyond where it is now, it is nothing but a simple pullback in an ongoing uptrend.

Support is at the NDX 1673-75 and then 1650-52 zones.  SPX support is at the 1250-52 and 1240-42 levels.

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.