We had three distinct parts of the session today, but at the end of the session the indices did end up on the plus side.

The day started out with a sharp gap-up, particularly on Nasdaq.  The S&P also moved up sharply at the opening, but that was about it.  Shortly after they opened higher, they began to sell off hard.  The Nasdaq dropped from 1535 to 1511 inside of a couple hours.  The S&P 500 dropped from 1208 to about 1199.  At that point they stabilized for a couple hours through the lunch hour and then started an afternoon rally, which took out several layers of resistance.  They accelerated in the last hour & into the close.

The Dow came back from a dip under 10,500 to close at 10,566, up 18.80.  The S&P 500 also dipped under 1200, getting down to 1198 and change, but closed at 1206 1/2, up 2.67.  The Nasdaq 100 was up 5 points after being down around 14 earlier in the day.

The SOX Index also reversed about 8 points, closing up 1.58 and way off the lows for the day.

The technicals also reversed in the afternoon session.  Advance-declines were 3 to 2 positive on New York and 17 to 13 positive on Nasdaq.  Up/down volume was a little more than 8 to 5 positive on New York with about 1 1/3 billion traded.  Nasdaq traded 1 2/3 billion, with about a 5 to 3 positive ratio on up/down volume.

So it was a plus session with a real strong comeback in the afternoon.   Despite the new lows on Nasdaq, the S&P and Dow did not confirm, and that helped propel the rally late in the day.

By far the leader today was Dynamic Materials (BOOM), which went bonkers, up 4.64 on 2.7 million shares, reversing more than 5 points off the low.

Other stocks of note, JAMDAT Mobile (JMDT) was up 1.22, Cree (CREE) up 73 cents, CryptoLogic (CRYP) up 45 cents, and Energy Conversion Devices (ENER) up 50 cents.  In the junior energy sector, despite late profit taking, Able Energy (ABLE) was up 70 cents and Georesources (GEOI) up 90 cents.

Vasco Data Security (VDSI) exploded on a gap-up on news to as high as 11.45 before falling back to 10.65, giving back a chunk of its profits, but still up 41 cents on the day on 3.2 million.

On the downside, Parlux Fragrances (PARL) was the loss leader, down 1.55, although it made up about half of its earlier losses.  DayStar Technologies (DSTI) gave back 49 cents, Air T (AIRT) 36 cents and PacificNet (PACT) 23 cents.

Stepping back and reviewing the overall patterns, as indicated earlier despite the new pullback lows in the NDX, the S&P was far from it, as was the Dow, and acted much better today, as has been the case over the last few days.

But it still remains a question of whether the Nasdaq is going to be pulled back up by the S&P and Dow, or eventually drag it down.

Right now it looks like the blue chips want to pull the Nasdaq out of the doldrums.

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.