Financials

Yesterday's post, "A Quick Look at Financials / FAS / FAZ" ended with the bottom line as new positions in FAZ (add-tos) have been on hold for a while,

"I want to see what the other industry groups are looking like, there's definitely an increased rate of deterioration in Financials."

That deterioration seen yesterday will be evident on the charts below, today is much worse, but you can see how the momentum shifted yesterday, again I do think this has a lot to do with the AAPL/QQQ move as well as some other things such as the massively Psychological level in the SPX of $1500, it's a magnet, there's a lot of money to be made just above $1500, which has since been lost.

First XLF, then the 3 leveraged long Financials, FAS which should look similar to XLF except it may have more extreme signals being leveraged and then the 3x short financials, FAZ which should be the mirror opposite of the other two and the signals are likely to be newer, at least the very strong ones as the timing is much easier when you have the entire depth of the book.

 XLF's daily candle is hardly  strong follow through/breakout candle, it' a bearish shooting star right now with pretty heavy volume which one would think was associated with a break to a new local high, but no...

 There was very little volume on the opening move above resistance, while I'm not a fan of huge volume as more subtle changes give us information that few others notice, it's pretty hard to ignore all this volume and price topping out.

 The 2 min XLF chart started with more downside 3C momentum yesterday and today started to cascade.

 Most interesting to me is the 15 min chart, it did turn negative yesterday, but it's not often one moves this deep in a leading divergence in one day, much less half a day.

 FAS (remember this is the long, it should resemble XLF above), 2 min

 3 min about as close as you get to a screaming signal with the time that its had.


 The 5 min is where we see more important signals and the deterioration here is notable.

 The 10 min leading negative is also a big move for the day and what I'd call a screaming signal, the only thing that makes is better and jumps off the chart more is a longer duration which is a function of time so it can't be held against the signal.

 Another 15 min leading negative and look where, consider the XLF volume today.


FAZ-(short) 3 min

 Remember I said "When the 5 min FAZ chart looks like the chart above..." in an earlier post, well there it is.

And a bit surprisingly, the 10 min chart.

Even if this is only for a short term trade, I think it's worth the risk here.