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Financial Select Sector SPDR ETF Message Board

  • keybotthequant keybotthequant Oct 5, 2011 9:08 AM Flag

    XLF Charts

    XLF charts setting up with positive divergence, and bounced yesterday, but they should have a little bit of lift to them in the near term.

    XLF Daily Chart Positive Divergence:

    XLF daily chart is set up with positive divergence over the two month and two week time frames with the exception of the RSI and MACD line which are starting to trail lower in the two week time frame (short red lines). The blue lines in the price chart shows a falling wedge pattern which would actually target 11-ish at its lower apex if you extend the lines to the right. The red circles show that price wanted to see lower lows than the August lows, and now we have those lower lows.

    The news is very negative with financials now, BAC web site problems yesterday after they decided to gouge customers with fees, MS has a 35% chance of going belly-up according to CDS spreads, GS broke 90 yesterday not seen since early 2009, etc..., so there is momo to the downside, but, the chart is set up for a positive divergence bounce. The 10.80-11.20 area, now, is an attractive entry point for a long play.

    For XLF daily chart use search box above for keystone speculator.

    I'll place weekly chart in next post.

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    • 1) What advantage is there for politicians to let financial institutions fail?
      2) Can politicians produce what banks need?
      3) When governments continuously issue debt to pay off past debt for year after year in an escalating manner history says they are really printing money.
      4) That's a different chart.

    • appreciate it, and I agree. Good analysis!

    • XLF Weekly Chart Positive Divergence:

      Financials weekly chart shows positive divergence now setting up over the last few months. Stochastics and MACD line, however, is not positively diverged over the last couple months (red lines). The red circles show how the indicators wanted to see lower lows with financials as the low prints were made in August 2011. Now we see those lower lows satisfying the red circles and creating positive divergence for a bounce (green lines).

      Keystone pointed out the top in the financials as it occurred earlier this year, that ominous top, along with copper's top, forecasted the broad market trouble we are in now. The pink H&S targets 10. The chart shows that price wants to bounce in the short time frame and then continue along sideways thru the 10-13 range for the weeks and months ahead. Banks around the world are in big trouble now, however, so the news flow can easily usher in increased weakness at any time. Generally, the banks have received a severe beating that is far along and long in the tooth at this point; the XLF falling from 17 to an 11 handle since its February top, thus, some price moderation is in order.

      Foe XLF weekly chart use search box above for keystone speculator.

 
XLF
24.13-0.33(-1.33%)Apr 17 4:00 PMEDT