Today was an absolute wild and wooly volatile day with near historical and multi-year oversold readings in the McClellan oscillators and the VIX reaching 5 year highs, indicating a sharp rise in fear, often seen at important lows, as well as other indicators that led me to believe we were setting up an important low here.

Near panic selling was set off by negative news from Countrywide Financial and other financial co’s, but they were the ones that led the market back in the afternoon.

The day started out with a gap down. A short bounce failed quickly and they sold off. They did bounce in the morning again but failed and rolled over hard in a strong five-wave decline that took the NDX down near 1805 and the S&P 500 down to 1370. But around mid-day around lunch hour they staged a strong snapback rally.

The NDX didn't participate as well. The S&P and Dow had sharp moves back up towards the morning highs, but resistance proved futile, and they backed off very sharply, with the NDX doing nearly a complete retest with the S&P holding up a bit better.

Then they reversed higher again with an hour to go and moved the indices sharply higher over the last hour, putting the S&P back into the plus column, some 41 points off its low and up 4 Ã,½ on the day.

The Dow, which was down over 340 points at one point, closed down 15, although it was up just before the close and backed off a little bit in the last few minutes.

But it still closed 328 points off the low, a tremendous snapback rally today. The Nasdaq 100 closed 41 points off the low, but was down nearly 60 at one point, ending down just under 19 points. The Philadelphia Semiconductor Index (SOXX) came back 12 points off its low, but still closed down 53 cents on the day.

So, a mixed picture at the close, but a definite, strong snapback rally late in the day that smacked of an important low.

The technicals, as normally happens in strong late rallies, failed to get back into the positive column, but did improve late in the session.

They were about 21 to 13, or about 3 to 2 negative on New York on advance-decline, and about 17 to 14 on Nasdaq.

Volume was very heavy today, with nearly 3 billion traded on New York and more than that on Nasdaq. The up/down volume ratio was about 4 to 3 negative on New York, but more than 2 to 1 negative on Nasdaq.

TheTechTrader.com board was mixed at the close, as you would imagine, but there were some huge snapback moves. DryShips (DRYS), which was down at one point at 46.21, closed at 52.16 ,nearly 6 points off the low but still down 2 Ã,¾ on the day.

Excel Maritime (EXM), also in the shipping sector, bounced about 2 Ã,¼ points off the low but still was down around 2 Ã,¼ on the day.

Aluminum Corp. of China (ACH), which at one point was down as much as 5, closed down 2, coming back about 3.38 off its low.

Other losses of note, Research Frontiers (REFR) plunged down through 11, was stopped out of our portfolio, tagged $10 and bounced back to 11.05. It was still down 1.74, breaking key support.

LSB Industries (LXU) dropped 1.01, NVE Corp. (NVEC) 1.07, PRG-Schultz International (PRGX) 1.13, and Rediff.com India (REDF) 1.08.

On the plus side, fractional gainers included Eschelon Corp. (ELON), which snapped back $3 off its low, closing up 96 cents on the day. Fueltek (FTEK) snapped back about 2.50, ending up around 46 cents on the day.

Chart of the Week IGTE had a very strong session relatively, closing at the high for the day going away, up 42 cents.

Sigma Designs (SIGM) had another strong performance, dipped under 30, down to 29.30 at the low. It closed at 31.56, up 67 cents, or about 2 Ã,½ points off its low.

So major reversals in many stocks today, particularly the popular trading vehicles.

Obviously the next day or two will be important as to whether we get a follow-through & confirm an important low, or whether this is just a stopping point in an ongoing, continuing downtrend. But based on historical precedents, it looks like today may have been an important low and we'll see how it goes over the next few days.

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.