NEW YORK ( TheStreet) -- The stock indexes had quite the intraday reversal on Tuesday, opening to the downside, then reversing course. At one point the DJIA was higher by 247 points before closing down 112 points. Many large-cap stocks including Apple  (AAPL) and Coca-Cola (KO) are extremely oversold and could bounce to the upside later in the week.

When all was said and done, the DJIA was down 111.87 points to close at 17,068.87. The S&P 500 lost 16.89 points to finish at 1,972.74. The Nasdaq was the big loser on Tuesday, finishing down 57.32 points to close at 4,527.83 and the Russell 2000 was fractionally lower by 0.92 to close at 1,139.38. This all occurred on SPDR S&P 500 ETF Trust  (SPY) volume in excess of 248 million shares.

The stock market bulls must be shaking their heads about why the huge up move on Tuesday could not be sustained. Major market reversals, like the one we experienced on Tuesday, are not bullish signals.

That may be indeed true, but the technical signals have been signaling "caution ahead" since November.

At the present time, the stock market has entered a bearish period. Stock prices, volumes and volatility of stocks and the market indexes -- and especially the rate of change in the market -- are all suggesting the stock indexes will be in extreme oversold territory on a red open Wednesday.

That said, there are 119 large-cap stocks displaying extreme oversold signals versus zero that are extreme overbought. The conditions appear ripe for a bounce to the upside over the next day or so.

Currently, large-cap stocks such as Apple, MGM Resorts (MGM) , Coca-Cola, EMC  (EMC) , Tesla Motors (TSLA) , Caterpillar (CAT) , First Solar (FSLR)  and Pepsi (PEP) seem to show extreme oversold conditions and are ripe to move up later in the week.

This article is commentary by an independent contributor. At the time of publication, the author was long AAPL.

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