Don't Ignore This Chart!

Financials iShares Bounces off Breakout


Chartists looking to track the finance sector can turn to the iShares Financials ETF (IYF). Note that the Finance SPDR (XLF) is in the midst of a metamorphosis this week so chartists can consider watching IYF for clues on the finance sector this week. IYF is in a long-term uptrend because the 50-day EMA is above the 200-day EMA and the ETF hit a new high in early September. Since hitting this new high, the ETF pulled back to broken resistance and this area turns into the first support level to watch for a bounce. Also notice that the 20-day Commodity Channel Index (CCI) became oversold last week and is starting to turn up. The Fed meets this week and Treasury yields will be in the spotlight when the FOMC makes its policy statement on Wednesday afternoon. Note that banking stocks and Treasury yields are positively correlated, which means banking stocks tend to rise and Treasury yields rise. 

Thanks for tuning in and have a great day!
--Arthur Hill CMT

Plan your Trade and Trade your Plan

Arthur Hill
About the author: , CMT, is the Chief Technical Strategist at Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London. Learn More
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