The markets had two very distinct parts of the session:  a very steep decline in the morning to new lows, and then a real impressive snapback rally that closed near the highs for the day going away.

The day started out with a gap down.  They had a strong rally early that failed right at resistance, which resulted in a five-wave sell-off.  The fifth wave of that sell-off intraday was a very steep one, and looked nearly climactic, as advance-declines and up/down volume as well as the put/call ratios, VIX and VXN and many other technical indicators were at very steep ratios, indicative of a bottom.

The resultant rally was a right-handed extended V pattern that in mid-afternoon took out key short-term intraday resistance, and stair-stepped their way higher all session.   Only a late pullback took them off their session highs.

Net on the day the Dow managed to get back into the plus column by 8 points, and that was about 180 points off the low.  The S&P 500 took back nearly 23 points, closing up 1.78.   The Nasdaq 100 failed to stay in the positive column, though was there for a few minutes late in the session.  It closed down 3.68 on the day but 26 points off the low.  The Philadelphia Semiconductor Index (SOXX) was 12 points off the low, down 0.79.   That put pressure on the NDX today, but also contributed to its late rally.

The technicals as would be expected did not quite get back into the plus column and were actually were negative by 3 to 2 on advance-declines after being negative by about 5 or 6 to 1 earlier.  Volume was huge today, monstrous, with more than 2 1/2 billion traded on New York and just under 3 billion on Nadsaq.  So 5 1/2 billion traded on both exchanges today, very climactic-type volume.  As is the case in most late rallies, up/down volume did not get back into the plus column, and was negative by 3 to 2 on New York and 3 to 1 on Nasdaq.

TheTechTrader.com board was 100% lower earlier in the session, but several stocks did manage to get into the plus column.  Allegheny Technologies (ATI), one of our Boxer Shorts, got hammered earlier in the morning, down below 55, but rallied 8, closing up 3 1/2 points on the day after being down nearly 5 earlier in the day -- a big short-covering, short squeeze there apparently.

Apple Computer (AAPL), after setting a new 2006 low nominally, rallied back by nearly 4 points and closed up 2.20 on the day on nearly 50 million shares. 

On the downside, DXP Enterprises (DXPE) lost 2.69 on more than 1 million shares, but that was some 2 1/2 points off the low.  Baidu.com (BIDU) dropped 1.38, but was up nearly 4 points off the low, and 51job, Inc. (JOBS) lost 2.09 today. 

Other losses of note, Rambus (RMBS) fell 1.03, Zevex (ZVXI) 94 cents, Pacific Ethanol (PEIX) 98 cents, LMI Aerospace (LMIA) 89 cents, Fuel Tech (FTEK) 85 cents, Energy Conversion Devices (ENER) 86 cents, and BioCryst Pharmaceuticals (BCRX) 84 cents.

Stepping back and reviewing the hourly chart patterns, early in the morning the indices cracked key short-term support, taking out the May 24 lows on the NDX and on the S&P, before the afternoon rally brought them back with a vengeance, bringing the NDX 40 points off its low and the S&P 25 points. 

So, it was a rip-roaring late rally, which came back above several minor layers of resistance but closed at key resistance near the 1560-65 zone on the NDX and the 1255-60 zone on the S&P.  It's very important that we get an extension on the rally tomorrow to be able to confirm that we put in an important low.

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.