Confirmation in Financials

I had a member ask me about FAZ and I found the chart so compelling, I wanted to post it for everyone.

First remember that 3C stands for "Compare, compare, compare". The more confirmation you can get, the better your signal is. One chart showing something is great, if all the timeframes or a majority line up, but when you can compare other equities and get the same confirmation, you are really making use of 3C the way t was intended to be used (Not everything you see in 3C or any indicator means something, it's confirmation that makes the difference). Also remember there are 3 main legs on the market's table, Energy, Financials and Tech, of course the other 7 main industry groups are important, but the market can't get far without these 3.

So here's comparison and confirmation in financials.

 Here's the short term on XLF today, t has turned down sharply and remember there are a lot of crummy financials that funds want off their prospectus for the new year, that's why I said any strength in the market and financials will likely see distribution, especially in BAC. I don't think anyone can argue that thus far, the Santa Rally has been a dud, yes, we had a bounce, but nothing out of the ordinary. As for window dressing, today is Friday, Monday the market s closed and Tuesday is the last day they can make trades for 2011 settlement and most everyone will be gone on Wall Street until the new year.

 XLF 5 min as it rounds over.

 FAS, being the leveraged long on financials should look like XLF. Look at the 2 min chart just fall apart today.

 And the 5 min is similar.

 The 15 is also going negative

 FAZ is the financial short, there are some stronger signals here and I believe it is because in FAS you will see selling, but not so much shorting as FAZ will be used to express a bearish opinion in Financials.

 Look at that 2 min chart!

 And the 5 min is similar to XLF/FAS except inversely as it should be for confirmation

 The 15 min chart is now starting to see the strength that has started in the shorter timeframes bleed in to this timeframe.

And 30 min, it looks like it has been basing for a while now.

I might have to look at adding to FAZ here.