jQuery child selector not working as expected

jQuery child selector not working as expected

here's my markup:
<div class=widget>
<div class=panel>panel1</div>
<div class=panel>panel2
<div class=widget>
<div class=panel>panel1</div>
<div class=panel>panel2</div>
</div>
</div>
</div>
i'm trying to select only the DIRECT (first level?) children with
classname panel, unfortunately i keep getting always the nested elements
(4 instead of 2).
please take a look at my fiddle:
http://jsfiddle.net/rx8Jf/
what's wrong? thanks