The indices started out with a little burst to the upside, right to resistance, failed, and came down hard in the morning, set new lows on the S&P 500 for 2005. The NDX made a slightly lower low, but held fairly close to its 2005 low, set yesterday. The indices rallied into the lunch hour, and then got sloppy for 2-3 hours and backed and filled and retested successfully. They came up to the 3-day declining tops lines by mid-afternoon and when they burst through that, they took off. It looked like short covering accelerated the afternoon rally.

The indices were solidly in the plus column at the close, with the Dow up 61.63, the S&P 500 up 4 3/4, the NDX up 12 1/3 and the Composite up almost 13. The SOX Index was up about 5.70.

The technicals went positive in the afternoon after being down most of the day. Advance-declines were 17 1/2 to 15 positive on New York and a little better than 16 to 15 positive on Nasdq. Up/down volume, however, was the story on Nasdaq by 3 to 1 positive on 2 billion shares traded. New York was 7 to 5 positive on less than 1.3 billion traded.

There were many strong moves on TheTechTrader.com board, led by Taser (TASR), which snapped back sharply 3 points on very heavy volume of 54 million.

Other stocks of note, one of our recent Charts of the Week, CRYP, continued its recent relative strength, up 1.03. AIRT, snapping back from a 2-month long decline, was up 1.41 today. WGAT snapped back 1/2 a point, PARL was up 44 cents.

On the losing side, there were fractional losses in MDKI, HDTV and ZOLT.

Stepping back and reviewing the overall patterns, the afternoon snapback resulted in a close right at the declining 40-day moving averages on the hourly charts, and we have some serious testing to do tomorrow.

We need to get a follow-through and we certainly have more formidable overhead resistance at the 1578-80 zone on the Nasdaq 100 and the 1195 zone on the S&P 500 to get though before we can say we've turned the corner.

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.