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What I needed, I didn't get

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What a broader market equity bear may have needed from last night's Index Trader Wrap was a continued move lower in the financials, especially the banks, but that just didn't happen today and the rebound in the S&P Banks Index (BIX.X) 251.20 +5.79% has sparked a broader market rally, which the bearish side of me thought it might.

The ability of the BIX.X to clear the 250 level is a bit concerning to a bear, especially from support lows found dating back to 2000. Upside to near-term resistance currently looks to be the 265 level or 260 at the mid-point of my regression channel.

S&P Banks Index Chart - Daily Interval

I don't think that a bear should be complacent today. Sure, the rally in banks may indeed be just a short-covering rally after the recent drubbing the sector has taken, but the rebound from the July/October 2000 lows is suspicious and hints that the MARKET was indeed watching that level as some type of support.

I've set up the Swing Trade Model for an OEX entry point at about 401, which I might correlate against a BIX.X pullback to 245 or so. Then, any type of rebound back above today's high in the BIX.X could further spark a broader market rally. As you can see, the BIX.X can "catch some fire" to the upside once a move takes place.

Troubling perhaps to some bears is the continued weakness in the Gold/Silver Index (XAU.X) 61.41 -5.2% today. This group of stocks are often times a "safe haven" group in times of uncertainty, but since finding resistance near the 76 level back in late September, this group has been getting crushed lower and does so again today.

Jeff Bailey

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