XLF Financials Daily Chart Sideways Symmetrical Triangle Tight Standard Deviation Bands

The daily charts of the SPX, INDU, COMPQ and XLF above, as well as many others display the tight standard deviation bands that are squeezing in for a big market move now at the door step. Markets are going to commit to direction over the coming days which will bestow one side or the other with a big win. The vertical side of the blue triangle is about one to 1-1/2 point. Thus, if the bulls win and break out above 22.0, the target above is 23.0-23.5. If the bears win and price collapses under 21.7, the target below is 20.2-20.7. The 200-day MA is 21.08 and multi-month support is in place at 21-ish so the downside target would be 20.2-21.10.

Price is under the 20-day MA at 21.89 and under the 50-day MA at 21.97. The 20 is under the 50 which is a bearish market signal. Tell this to the banks which continue to find a way to remain buoyant. The thick red line is the XLF 21.83 level currently identified by the Keybot the Quant algorithm as the bull-bear line in the sand and the algo identifies financials as the most influential parameter effecting broad market direction right now. The fate of both bulls and bears is decided by XLF 21.83. Price is 21.87, four pennies above, in the bull camp, creating market bullishness and a higher stock market. Bears need to push XLF under 21.83 as soon as possible, otherwise, they got nothing.

Price is coiled for the big move but as the triangles show, the theatrics may continue into next week since there is about another 5 to 7 days available in the apex of the triangle before price has to decide which way to run. So by the end of the month, next Friday, 5/30/14, the winner will be clearly obvious. By then, either bulls are running to the SPX 1920's or bears have begun a new down leg setting sights on SPX 1848 support. XLF 21.83 tells the broad market directional story today and the path forward. Markets are typically bullish moving into a three-day holiday weekend so the bulls have a seasonality advantage. 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.