Financials is arguably the world’s most important sector.
They tell you more about the current environment and risk appetite than almost any other group.
They’ve been critical to both the upside and downside in previous cycles, and their strength—or lack thereof—often sets the tone for the broader market.
Right now, both the Financial Sector and Regional Banks are hitting new 52-week lows relative to the S&P 500.
This is not something you typically see in strong, healthy markets.
Persistent weakness here is another red flag worth watching closely.
The fewer bank stocks participating in an uptrend, the weaker and less resilient the overall market rally tends to be.
for this bull market to remain healthy, we need to see these two ratios hold their ground and start moving higher. If not, things could get a lot messier.
Stay sharp,
Alfonso De Pablos, CMT
Director of Research, All Star Charts
Editor's Note: The Best Trade of the Year
On September 9, I bought the $RGTI 10/17 $20 calls at $0.59 — a clean setup that triggered as the stock broke out.
Fast forward to today, and they hit $33.70 — a 5,612% gain, making this one of our biggest wins of the year and the second-best trade ever for Breakout Multiplier.
