It looks like a pinpoint perfect back-test of the 50-dma on the $BKX. I think it's a trick destined to fail--after pulling in another trainload of shorts. Fail? Yes, the 50-dma will fail to contain price as it busts out for higher territory and a position above the 200-dma.
The banking sector could be one of the biggest winners between now and July 4. Why? The recent bearishness was not bearishness. It was a sideways consolidation after a 100 percent gain off the March lows.
If the $BKX was going to crash, it would have crashed. It didn't. There's a reason. It intends higher prices based on the steep yield curve.
During the sideways action, the banks accumulated more and more shorts who became increasingly fearless because at least they weren't losing money. Now we have to worry about the market crashing UP. Look out above. FAZ will visit $3 and change.
Ted
Buyer Beware. The above advice is FREE!