The stock market indices started out the week with a very volatile session with a gap up in the morning on positive news over the weekend, immediately reversing, going sharply south, particularly when the ISM came out with a very negative report. They then bounced in a bear-wedge-type fashion and went sharply lower again, reaching the session lows just before noon. At that point the Nasdaq 100 had dropped from 2396 1/2 to 2325, 71 points from top to bottom. They did bounce back in the afternoon, with the NDX rallying back from 2325 up toward the 2356-57 area, and then backed off just a little, and closed near the afternoon highs. The S&P 500 dropped from a high of 1307 to under 1275, bouncing up to the 1287 area when the indices snapped back in the last hour and a half from the oversold lows.

Net on the day, the Dow was down 10.75 at 12,132.49, 135 points off the low. The S&P 500 was down 5.34 at 1286.94, and the Nasdaq 100 down 8.76 at 2354.05, nearly 30 points off the low.

Advance-declines were positive by 16 to 14 on the New York Stock Exchange and about 14 to 12 negative on Nasdaq. Up/down volume, however, was 7 to 4 negative on New York on total volume of 1.8 billion. Nasdaq traded 2.33 billion and had about a 2 to 1 negative ratio.

TheTechTrader.com board was mixed with some nice gainers today. Genetic Technologies Ltd. (GENE) had a big percentage gain of 30%, up 1.71 to 7.35. NVIDIA Corporation (NVDA) jumped 74 cents to 14.57, Sify Technologies Limited (SIFY) 58 cents to 5.48, Datalink Corp. (DTLK) 45 cents to 10.79, Heartland Payment Systems, Inc. (HPY) 85 cents to 21.89, SodaStream International Ltd. (SODA) 4.33 to 77.68, Coffee Holding Co.Inc. (JVA) 1.68 to 21.15, and Apple Inc. (AAPL) 6.27 to 396.75.

Those were the point-plus gainers on our board today.

Fractional gainers included Rediff.com India Ltd. (REDF) up 76 cents to 10.67, Tesla Motors, Inc. (TSLA) 60 cents to 28.77, ZAGG Incorporated (ZAGG) 74 cents to 16.09, and Molycorp, Inc. (MCP) 90 cents to 64.53.

On the downside, the only point-plus losers on our board were International Business Machines Corp. (IBM) down 1.10 to 180.75 and InterDigital, Inc. (IDCC) down 1.13 to 67.12.

The iPath S&P 500 VIX Short-Term Futures ETN (VXX) was down 1.00 to 22.41.

Stepping back and reviewing the hourly chart patterns, a sharp sell-off ensued for the indices in the morning after opening gaps, and then they stalled, consolidated, and stabilized by early afternoon. They rallied late in the day to take back a chunk of the losses, especially on Nasdaq. However, the downtrend remains intact until it’s reversed.

We may see more damage.

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