Banking Sector Continues to Trend Lower

One of the main reasons that I am taking an intermediate term bearish stance on the market is due to the banking sector which continues to get hammered.  There have been some banks holding above their January/March panic lows while others have been setting new lows.  I was first turned on to the idea that the market topped when I saw that the banking sector topped and started heading lower.

The banks led us down in January and March and led us back up to the recent high we just set.  Now, they are again taking leadership to the downside.  This is NOT what you want to see.  We haven't seen the Financial ETFs (XLF) or (UYG) challenge their respective spike lows from earlier this year, but we want to be on guard because we see a lot of individual stocks breaking.  Let's take a look at a few charts.

Let me be clear, these are intermediate term views of these banking stocks and not to be confused with short term pops that could occur at any time.  The broad market could bounce on the short run, which could lead some of these a bit higher.

 

WB

 

Disclosure: No positions

Comments

[SW Richmond:]

TOMO report
www.gmtfo.com/RepoRead...

Will the Fed crap more cash at the banks? Or should I say, how much, and how soon?

2008 Jun 03 07:32 AM

[Bugs:]

Without banks there can be no economy. Its that simple. Long Term I like Citigroup because it is America's international bank along with J.P. Morgan - Chase Manhatten. Those two are it along with the investment banks - brokers. For a national bank Wells Fargo or even Bank of America will be solid.

2008 Jun 04 05:53 AM