This might be worth a shot, Financials were in rotation today -.12% vs. -1.35%. It seems to me we have more downside in the pullback and it is likely to rotate just as the longs did earlier in the week between Tech and Financials.
If that's the case, then Financials short would be the play, but again keep in mind these are very speculative and nimble trades that you have to be able to get out of pretty quickly, also the position size should be speculative, this is about as speculative as you get.
When comparing FAZ (3x leveraged BEAR Financials) to FAS (3x leveraged BULL Financials), some interesting things appear suggesting that rotation.
These charts show confirmation and they show that it's a short term trade.
FAZ (short financials) 2 min leading positive divergence suggesting in the near term financials fall/pullback. The trade would be FAZ long.
FAS (long financials) 2 min chart have a negative divergence suggesting the same thing, Financials fall in the near term/pullback.
FAS long financials 3 min is leading negative
At 30 min there's still a positive position so this fits with the market outlook for short term and more upside after a pullback.
Basically it's speculative, it counts on rotation and it's a quick leveraged trade, but I think probabilities are good that it works.
No comments:
Post a Comment