The following is just a small excerpt from my latest Weekly Strategy Session (please click on that hyperlink for details about trying it out). which I published for members and 12631 subscribers this past Sunday.
In addition to the Russell 2000 Index lagging last week, bears will surely point to the weak action in the regional banks, seen on their sector ETF daily chart, not to mention a few big banks like Goldman Sachs, quite weak on Friday and bear-flagging on its own daily chart.
Given this setup, should the current market bounce roll back over early this week, I would almost assuredly be looking at the financials for short ideas.
But beyond the daily charts, there is a larger issue in play with the regional banks, especially.
On the monthly chart for the regional bank ETF, it is worth noting that the regionals topped out many months before equities did back in 2007–Not just a mere few weeks or so. Seeing as the regionals lagged the market’s bounce last week, the action in the sector going forward merits your attention to see if they once again top out in front of the rest of the market.
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