Order Of Magnitude

 There is a lot of buzz on the technical blogs that the market could be forming an 'inverse head and shoulders' pattern.  The pattern is a common signal for the reversal of a downtrend.  We don't see the desired volumes in the pattern right now, but that won't stop us from riding a bit of a wave up if the neckline is breached.  If the neckline is breached on volume, a self fulfilling prophecy will unfold as all those that are calling the bottom will buy in and force the price up.  If the neckline is breached we will be taking our profits off the table at about 75% the height of the pattern.  Here's a look at the Equivolume charts for the funds.

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Sandisk has been all over the place since Samsung made an offer to buy the memory manufacturer.  Gaps on volume appear to be quite normal for the last coule of months, and some will note that 2 of the last gaps were filled over the following trading periods.

Equivolume:

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Support and Resistance:

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Morgan Stanley moved a lot of volume over the last couple of days.

Have a look at the Equivolume:

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Looking at the October Call contracts:

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Volatile indeed, there is a lot of premium priced into those contracts.

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SL Green Realty Corp. felt pain outside of the ordinary in today's bloodbath.  The REIT holds a good deal of office space in downtown New York, and no doubt a chunk of it inhabited by the various financial companies in pain these days.  The price smashed through the support areas around $75 to $76, and did so with a great deal of force in volume.  Selling short, picking up some long term in the money puts or selling out of the money calls are all posibilities depending on the state of the market in the morning.

Support and Resistance graph since last October:

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Equivolume:

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The financials got hammered today, and smashed through support that was holding around $19.50.  The price was recently trapped in the channel between $19.50 and $23.50.  This one has the potential to head down to $17.00 again, with support at the July lows.

On the other side, candlestick chart readers will see the inverted hammer which can be a downtrend reversal depending on how tomorrow goes.  For confirmation the price can not trade below the open all day.

Tight management is the only way to trade in this environment

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Walmart showed up on a strength scan, and in the last couple of days there have been tests of $61 with some volume.  Looking at some charts:

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The price action has come close to $61 a few times in the last handful of weeks.  Since the plunge in August, the buying pressure has been ramping up and has been approaching the all time high of $60.99.  If that level can be taken out and held for some time, it could be that the sellers at $61 have dried up on the discount retailer.

The average true range over 20 trading days, is almost $1.50.  This means even an average move against a long position entered at $61 would be in the $59.50 area.  If you keep 2:1 reward to risk, setting a stop at $59.50 would mean expectations for the price action to move up to $64.  It's tricky working with equities at their all time highs, so unless you eat risk for breakfast, this one may be better on the sidelines

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With the markets experiencing a sell-off more akin to a blood bath, it's rare to find advancing stock.  Not impossible mind you, and even more rare is a stock advancing with abnormal volume.  See below for Amazon and Qualcomm:

Equivolume: AMZN

Equivolume: QCOM

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A company we've been following since the new year is E*Trade Financial Corp. . On Monday, while the market was sliding to an ever impressive low, E*Trade announces that they were selling their Canadian subsiduary to Scotia Bank.  Yesterday, like all financials, it took a run back towards the nearest resistance, and today kept on pushing upwards.  I'm sure the extra capital helps in times like these, especially considering the sticker price is one quarter E*Trade's current market capitalization.

Looking at the Equivolume chart:

Equivolume ETFC

Compared to the Equivolume for the Financial Spider:

Equivolume XLF

You can see that E*Trade was able to close above the recent high and show a good clean upward body, whereas the overall sector was not.  There is a tonne of volume at the $4 level, so I would not expect the price action to move to much to the upside.  If the price holds, then opening a position on any pullback to $3.50 may be in the future.  Having expectations of $4, and getting out at $3.25, would give a 2:1 rewards to risk taken, and could net over 14% before fees.

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