by Sam Collins 07/21/08
Financial Select Sector SPDR ETF (XLF) -- This index of the financial components in the S&P 500 (SPX) includes an array of diversified financials from investment management to commercial and investment banking.
The Trade of the Day has covered the XLF with bearish readings on Dec. 20, Jan. 24, and most recently on March 24, when we said, "The downtrend is still intact and now the March 17 low at $22.29 is under attack. Watch this index since it could indicate the future direction of the broader-based indices."
The XLF's March 17 reversal did produce a significant rally but then fell through support, producing a series of sell signals from our internal indicator the Collins Bollinger Reversal (CBR). This rally could take the XLF up to the 50-day moving average at $23 but there it will likely fail.
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