Bulls Gaining Control - SanDisk

Published on Tuesday, 07 February 2012 04:12 Written by TradersHuddle Wire

New York, February 7th (TradersHuddle.com) - Shares of SanDisk Corporation (NASDAQ:SNDK) ended the trading session lower by $0.16 or -0.33% from its previous close. SanDisk's price action in today's session formed what is considered to be a Hammer, where bears drove prices lower intraday. However, the strong finish indicates that bulls regained control forming a trend reversal.

SanDisk Corporation (NASDAQ:SNDK) supplies flash data storage products. The Company designs, manufactures, and markets industry-standard, solid-state data, digital imaging, and audio storage products using its patented, high-density flash memory and controller technology.

SanDisk's stock has been trading in a well defined range with support at $45.43 and resistance at $53.08, this range is also being used by traders to plan their positions.

Traders wanting to establish a position in SanDisk or traders that are already holding the stock can use the hammer formation to their advantage, since the pattern signal a potential bullish trend reversal.

Hammers are important candlesticks as they mark bottoms and support levels. Further buying pressure, and preferably on expanding volume, is needed before acting, as heavy volume will serve to confirm the validity of the reversal.

In the case of SanDisk, traders who want to add to their positions or start a new position, need to watch for confirmation of the reversal. Below a Hammer illustration: