$XLF : Great setup for a short

With news of JP Morgan making a loss last quarter and now Morgan Stanley having a cap on immediate cash bonus, XLF is clearly being setup for a great short.

Let’s review the chart.

1. We can see that on the Ichimoku Daily Chart for XLF that it is bumping into the resistance level at $14.

2. While the Daily Chart shows that XLF is in bullish territory, the last 3 candles is not showing great strength. The candles are suggesting that XLF may turn from here.

On the Ichimoku Weekly Chart, the setup is clearer.

1. Like the Daily Chart, we can see that XLF is hitting the resistance at $14

2. The key difference is XLF is still bearish on the Weekly.

3. In the coming 2 weeks, XLF will be slamming into the kumo resistance and the flat kumo top is suggesting that XLF has a higher chance of consolidating below $14.

I will be establish a SHORT CALL spread on XLF.

By iam802

Trend trading with Ichimoku