E*Trade Financial Corporation (ETFC) plummeted 50% today after it reported that “deterioration in the value of its mortgage-backed securities has fallen significantly.”

The stock had been in a recent downtrend on the daily charts (since August, 2007) and a fresh downtrend after a lengthy consolidation period on the weekly charts.

From a 2007 high of $26, the stock has now fallen roughly 86% to $4.

I am posting the weekly chart below:

As goes the old adage in technical analysis, the longer the consolidation period, the longer the eventual breakout.

How many people could have conceived that a major broker, and popular trading household name, could have such a massive decline in one year?

Sourse: ETrade Falls 50% Today

                        

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