The session and week started out with a down-day.  The indices opened lower, fell rather sharply this morning, taking out initial key intraday support, and then held at secondary support before bouncing and meandering in bearish flag-type patterns for the rest of the session.  However, towards the end of the day they did firm back up towards resistance.

Net on the day the Dow was down 42 1/2, the S&P 500 off 3, the Nasdaq 100 14 1/3, and the SOX Index nearly 8.  That really hurt Nasdaq today, with the SOX closing down below 500 at 497 and change.

The technicals were negative by 3 to 2 on advance-declines on both exchanges. Up/down volume was 3 to 2 negative on New York but nearly 2 to 1 on Nasdaq. Total volume was about 1 2/3 billion on both exchanges.

TheTechTrader.com board was mixed, but there were some outstanding issues to the upside.  By far the leaders were BOOM, up 4.12 on 7.7 million on a contract with GE, and PWEI, breaking out of a consolidation pattern and exploding for 3.17 on nearly 1 million shares.

Other stocks of note, ENER was up 83 cents also on contract news.  ATEA, a Chart of the Week this week, was up 75 cents to a new multi-year high.  Low-priced ALOY advanced 39 cents on almost 1 million shares.

On the downside, the loss leader was CNTF, down 2.27 on 2.3 million.  LEXR, on a negative court ruling, fell 81 cents on more than 10 million.  IIJI following up on Friday's big down day lost another 61 cents, JMDT fell 53 cents, DCAI 43 cents, and ARXX 31 cents. The SMH was down 66 cents, and the QQQQ off 31 cents.

Stepping back and reviewing the hourly chart patterns, the indices appear to be consolidating last Thursday's run-up and Friday's continuation attempt by pulling back and retesting in a Fibonacci retracement today.

The key is going to be whether these level holds, and it needs to in order to continue the rally, or we may come down further and test lower levels.

Today's bottoms near 1690 NDX and 1258 S&P are short-term support, and if those are broken we'll probably see a test of lower levels.

On the upside, resistance is at the 1709 double-top from Friday on the NDX and very distinct level at 1266 on the S&P.  Those are levels needed to be taken out if the rally is to continue.

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.