Monday, July 8, 2013

XLF Financials Sector Weekly Chart Overbot Negative Divergence

The XLF is not as enthusiastic as the BKX.  The larger bank charts such as BAC, C, GS, JPM, etc..., show topping and rolling over behavior this year and create the lack of enthusiasm in the XLF. The Fed also plans on increasing capital restrictions on the larger banks in the weeks ahead. This also verifies that the chase into regional banks, KRE, is creating the move up in the BKX. The XLF chart shows roll over behavior with the RSI coming off overbot levels. Intraweek last week the price matched the May-June highs which sets up the negative divergence in the indicators (red lines) although typically price prints a more substantive higher high which would be in the red circle. Projection is sideways to sideways down for the weeks ahead.  WFC kicks off the bank earnings this Friday morning. and is an important proxy for the health of the housing sector. WFC weekly chart shows a hanging man candlestick from last week with negative divergence so the read at this juncture is that it will sell off this week or when earnings are released on Friday. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.