A glance at the closing gain of 270 points on the Dow Jones Industrial Average (DJIA) might lead you to think we had a quiet afternoon. After all, a midday check of the action showed the Dow was up 230 points. However, the intraday chart shows the rough ride we really had. An early-afternoon selloff had the Dow giving back all of the day's gains and, by 2:30 PM, it looked as if we were in for more of yesterday's brutal action. But as quickly as the afternoon selling began, it ended. Buyers then stepped in and we end the day with the DJIA near its highs of session.

Earlier we saw that buying was fairly widespread across most sectors and that remained the same at the close. The US Oil Fund (USO) posted the only loss on my list as the Oil Service HOLDRS (OIH) and iShares Treasury Bond (TLT) rallied to small gains. The Regional Bank HOLDRS (RKH) took the lead as it recouped nearly half of yesterday's drop. The Amex Gold Bugs Index (HUI), Russell 2000 (RUT), SPDR Homebuilders (XHB), Broker/Dealer Index (XBD), and PowerShares Clean Energy ETF (PBW) were also relatively strong.

Earlier I touched on how the S&P 500 (SPX), Nasdaq Composite (COMP), and Russell 2000 (RUT) were having trouble at their October lows. Today's bounce is a step in the right direction but we still need to see more signs that buyers are out there. My main concern, as I have been stating, would be a failure here that leads to a test of the lows from November 20 and 21. A breakdown there would mark a continuation of the classic downtrend pattern I described last night.

And that is where I will pick up in the morning. Have a nice evening...

Chart Courtesy of Thomson Financial

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Charts Courtesy of Thomson Financial