The indices managed to stage a last two-hour recovery that brought them back from the abyss and back into positive territory.

The day started out with a surprising move up at the opening that failed immediately.  A sharp pullback retested Friday's lows on the indices.  They bounced late morning and early afternoon, right up to resistance, and failed, and then sold off sharply in a second, equal down leg that took the NDX to new lows for the year, reaching as low as just under 1447.  The S&P at that point reached down below 1225 but held above the lows reached last in June, around the 1220 area.  So we made a higher low on the SPX and a non-confirmed new low in the NDX  .

At the end of the day, the late surge brought the indices back into positive territory.  The Dow rallied about 115 points, to close up more than 51.  The S&P 500 gained about 12 points off its low, closing up 2.3.  And the Nasdaq 100 rallied about 26 points, closing up nearly 4.  So, big losses were erased today and then the indices closed in the positive territory.

The Philadelphia Semiconductor Index (SOXX), even though it rallied 11 points off its low, still closed down 1.52 on the day, but came way off the morning lows, as well.
 
Technicals managed to turn around and went slightly into the positive side, with 230 more advances on New York and about 170 on Nasdaq, but still narrow.  The up/down volume was slightly positive on the New York Stock Exchange, with a total of 1.65 billion traded.  Nasdaq traded just under 2 billion, with about 11 to 8 positive on the up/down volume.

TheTechTrader.com trading board was narrowly mixed.  A point-plus gainer today was Pharmaceutical Product Development (PPDI) on excellent earnings and upgrade, up $2.36 on 3.4 million.  Qualcomm (QCOM ) advanced $0.84 on 14 million shares today.  But most others were just fractional gainers.  Apple (AAPL) managed to gain $0.53.

On the down side, the GLD gold tracking stock dropped $1.13 and  Energy Conversion Devices (ENER) also dropped $1.13.  Those were the only point-plus losers.

Stepping back and reviewing the overall patterns, the Nasdaq 100 tagged new 2006 lows today, but failed to get a confirmation from the S&P 500. Despite it making new pullback lows, it did not take out the June lows.  Now, the late surge, which closed near the highs for the afternoon going away, needs to get a follow-through thrust. 

We'll be watching resistance at around the 1477 area on the NDX and the 1240-42 zone on the S&P to see whether we can that follow-up thrust tomorrow & take out of secondary resistance

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.