Trade Alert

I have mentioned that I like the idea of starting a position short in JPM and either starting or adding to the BAC downtrend already intact. With this morning's XLF action , which I think is limit orders placed after retail saw the rally there, that are being filled, this may be a good opportunity for a low risk short entry.

 Here's the Stop Channel on a 3 day chart for BAC-the upper channel line's lowest point is the stop, so it's near $13 while BAC is near $12.48-a little more then $.50 risk for a trend that has been in effect for more then 2 quarters. I showed this trade about a week ago and said if we got close to the upper channel, it may be a trade on the short side you may want to consider, the closer to the channel, the less risk as that is your stop.

I also showed JPM's trading range and said I'd like to look at initiating a position there near the top of the range, but I would not fill it out until it broke below the bottom of the range (confirmation), well here we are. A stop can be placed above the top trendline which lowers your risk on the trade so long as you observe risk management/position sizing.

I don't know if XLF will carry a much higher as I do believe it's limit orders being filled so if you like the trade, you may want to take a look at it.