The markets had another follow-up down day, and we've been down for 4-5 days in a row now, and starting to get oversold enough to where I think we can get a decent snapback rally as early as tomorrow.

The day started out with some mixed action.  The indices eventually moved lower in the morning, took out the recent decline lows, snapped back & failed again, then stair-stepped down for the rest of the day.

Net on the day the Dow was down 48 1/2, the S&P 500 10 1/4, and the NDX 5.70, but the SOX did manage to gain 0.59 today.

The technicals were negative by 22 to 10 on advance-declines on New York, and 20 1/2 to 9 1/2 on Nasdaq.  Up/down volume was decidedly negative by 13 to 4 on New York and 11 to 9 on Nasdaq.  Total volume on the NYSE was 1 3/4 billion and over 2.1 billion on Nasdaq.

TheTechTrader.com board was mostly negative today, with several large losers.  Dynamic Materials Corp. (BOOM) got hammered, down 3 1/4 today.  Astea International (ATEA) was down 3 1/2.  Energy Conversion Devices (ENER) backed off 2.58 and Bentley Pharmaceuticals (BNT) 1.15.

In addition, Pacific Ethanol (PEIX) fell 93 cents, Rediff.com India (REDF) 80 cents, PW Eagle (PWEI) 63 cents, and TradeStation (TRAD) 69 cents,

Losses were severe in the alternative energy sector.  In addition to ENER, DayStar Technologies (DSTI) dropped 91 cents, Evergreen Solar (ESLR) 80 cents, and Distributed Energy Systems (DESC) off 78 cents.

BioCryst Pharmaceuticals (BCRX) lost 97 cents, and NeoMagic (NMGC) 41 cents.

On the plus side, LightPath (LPTH) jumped 2.68 on heavy volume, and led Nasdaq's percentage gainers today.  Openwave Systems (OPWV) advanced 86 cents, and Stereotaxis (STXS) 31 cents.

Stepping back and reviewing the hourly chart patterns, as indicated the indices continued lower today, but are now reaching oversold enough levels (the lowest readings since last October) where I expect a mid-week rally starting as early as tomorrow morning.

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.