Friday, November 30, 2007

Financial Sector ETF


On of my favorite indicators for the markets is the $BPFINA, when its >30 level its time to buy the XLF, this time I was too early as we went all the way to 16.13 and its not too late to catch this move, they are extremely oversold still and we wont go straight up so I have been nibbling since the day the character of the markets changed the best friends of the at this time are the Financials. Check out the chart it will tell you when to exit, usually at or above 80. You can see on the weekly chart takes time to unwind so I try to sell in increments as it can stay overbought for weeks.

Posted by prudentstockinvestor M.D. at 11:53 AM

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About Me: Disclaimer

$BPCOMP

$BPCOMP
Extremely Oversold

Regarding Chart: BPCOMQ

This is the lowest close seen in years, usually a sharp and violent rally follows these moves enhanced by short covering, this is no time to short and start making a shopping list.

Bear-ly Hangin" In dustrials

Bear-ly Hangin" In dustrials
Dow Graph: 11/20/07
The Dow looks like its fighting for its life here at the level. It's no surprise there was a vicious bounce off the trend line as shown in the chart. Unfortunately, the last time we had that five hundred point reversal day was caused by the Fed stepping in, there has to be a similar event that helps the market or there is more pain ahead. The Fed minutes said nothing the market really liked, we sold off hard and bounced back hard as we hit support. This was just a reflex rally we may have to get one more really painful selloff to get around 12500.