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Market Notes: The Ugly Chart Party


Here's what the Buzz & Banter team is watching on this ugly Wednesday afternoon.

This article was originally posted on the Buzz & Banter where subscribers can follow over 30 professional traders as they share their ideas in real time.

The Russell 2000 had a brief period of outperformance intraday, but it didn't last:

De-risking is the name of the game today.

If we look at the zaniest areas of equity land -- social media (SOCL), China tech (CQQQ), and hot momo names like FireEye (FEYE) and Mobileye (MBLY) -- everything's getting smashed up.

JNK is still green, but has lost most of its intraday gains.

Transports, namely airlines, are getting destroyed on the Ebola fears. I'm still looking at JetBlue (JBLU). This disease outbreaks are awfully scary, but they have tended to not do long-term damage.

And keep in mind, the airlines were probably due for a breather anyway.

The NYSE Arca Airline Index (XAL) was up 28% at one point this year:

And speaking of Ebola, look at drugmaker Tekmira (TKMR), which is up a whopping 22.1%. That brings me to our favorite chart -- Tekmira vs. the VIX.

My colleagues are laughing at me over this one, but if we're look at volatility drivers for the near-term, Ebola is definitely on the list.

Another name to keep in mind -- CNBC's Melissa Lee said the CEO of Ebola drugmaker Newlink Genetics (NLNK) will appear on Fast Money at 5:00 p.m. ET tonight. That could spark an extension beyond today's 11.5% rally -- a blowoff top perhaps? The fleet-fingered day trader should probably tune in.

From a big-picture perspective, are we seeing a repeat of the big February-March high-beta washout that left the large caps intact?

For now, with the exception of biotech, which is less than 4% off its high, the answer is yes.

The Russell is down over 10% from its July 1 1213.55 all-time high, so that correction's been going on for a while. It's also 8% below its September 3 interim high.

SOCL is down 10% since its September 11 high.

And a lot of momo names like the aforementioned FireEye and Mobileye, as well as the 3D printing names have been getting wrecked.

Meanwhile, the Dow and S&P are off all-time highs by just 3.0% and 3.4%, respectively.

Right now we're just dipping below the 100 day moving average on the S&P 500.

Every time that's happened this year, the bulls bided a little time before buying the dip -- so that's a level to keep your eye on.

Twitter: @MichaelComeau

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No positions in stocks mentioned.
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