The one sector that I have had little to no interest in buying over the large part of this year has been financials.
Sure, from time to time I have dabbled in them – some successful, some not so. However, they have been one of the least traded sectors for me and that doesn’t look to change any time soon.
And take a look at the chart below – that’s not good, my friends! It is a weekly chart, and it tells you all you need to know about the banks and financials as a whole. It even broke down below the 50-week moving average.
You also have a declining trend-line starting up, followed by broken price support, a broken, rising trend-line and a recent record of 13 consecutive days of red.
Now, the financials are surely oversold at this juncture, so shorting them in this market, isn’t the best approach either. But trying to make a buck off a pop is really fool-hearty, and there are much better trades to be had.
So take a look at the chart – realize, “Hey, this is bad!“ and move on to a better sector!