Friday, January 16, 2009

Update…

The XLF is down 4.5%... WFC is down nearly 12%, and now GE is joining the fun. XLF is dragging all the other indices with it again. The XLF looks to me like it’s targeting $9 after producing a small H&S pattern. If it keeps it up at this rate we’ll hit it today… that would be a horrific 10% move! Not sure if we can really do that much in one day, but it appears to be giving it a shot...

Here’s a 5 day chart. You can see that we’ve made a new lower low, and as I extend the channel, support is at sub $9 for the day…


I got more short on the break of that neckline and then again got more short when the SPX broke it's uptrend line. Watching closely, I think the XLF is obviously the key to today.

I note that the VIX is coming back up and so are bonds which have jumped back up out of their channels - glad I didn't jump on that!

Here's a little XLF meltdown music...

Velvet Revolver, Fall to Pieces: