Financial sector bottoms?

[john_for_u80]

I agree with Chartguru about his call saying that "financials have bottomed".

I would like to post some charts which I have come across and some details.

Chart 1: "The justification for this bullish call came from the KBH Banking Index (BKX), which had broken the first-quarter lows at 75 and headed straight toward multi-decade support between 55 and 60. "

Chart 2: "I now believe the current recovery attempt will end at the 38% or 50% retracement of the long selloff. Notably, these numbers would place the index right at new channel resistance between 75 and 83. It would also correspond with the declining trend line generated by the weak rallies embedded within the downtrend"
"A strong bounce into the 80s might be optimistic, given major resistance created by the breakdown under the triple-bottom pattern posted between January and March. That price level corresponds directly with the 38% retracement. It's also just 5.5 points above Wednesday's closing level. "

Chart3: "Apple plunged from a post-split bubble high at $37.60 in 2000, selling off more than 80% in the next nine months. It then bounced from $7 to $14 and dropped into a dead man's base for more than three years.

Of course, the late-2000 rally looked like a perfect bottom, attracting a fresh batch of shareholders certain they were making the buy of the century. As it turned out, these folks learned a painful lesson about opportunity cost, with their investment looking like dead money while the rest of the equity universe enjoyed a fabulous recovery."

[wallstreetsedge]

i wouldnt say they bottomed.. btw that skf hit my target again today john :P keep the faith!!

if anything its only a little harder for them to continue downward, theres still a big mess in the financial industry. i dont think itll be cleaned up until next year. financial companies are still in the middle of auctioning off their debt

[john_for_u80]

Originally Posted by wallstreetsedge

i wouldnt say they bottomed.. btw that skf hit my target again today john :P keep the faith!!

if anything its only a little harder for them to continue downward, theres still a big mess in the financial industry. i dont think itll be cleaned up until next year. financial companies are still in the middle of auctioning off their debt

Yeah, I sold it too soon in the morning.

Also by mistake I sold some of my shares yesterday. I thought I am putting a market buy order and I kept sell order by mistake, that reduced my position.
Right now I am out of most of my cash because I have a cash account which takes 3 days to clear the trade settlement.
Hope I get some on Monday

[wallstreetsedge]

i think it might head to 130 before heading back down.. if it does id look for 118 as my first target

[Pinguin]

I have started to look at XLF since I agree with the overall concensus of the thread. My question still remains at what cost to the American public will the gov't interact witht he financial sector?

I think we will see some short-term optimism over the next couple weeks....as long as nothing drastic happens in Beijing.

[Jimmy058910]

It'll be interesting to see what financials do tommorow after the beating they took today, if they take another large hit, I will be putting some dough in on Monday on a bounce back no question about. If they do alright tommorow, I am going to stay away as the industry is a mess.

Hopefully oil will make a little run tommorow, which will keep the financials down tomm. setting me (and you guys) up for some shorts on monday :- )

[englishman26]

Everyone's getting geared up for the shorting to start again next week. Some the best bad news comes in the financials at the weekend so I actually like to be in SKF over the weekend. And believe, most of the surprise news wil be bad at the moment because. . .well. . . things are bad!

I'm actually in England at the moment. Feels like things are just beginning here.

I don't think we're at any kind of bottom in financials yet because we're no where near any kind of bottom in housing yet.

GLTA.

[Horsefish]

This is probably a good thread to ask this dumb question on.
Those short term loans that the FED is giving out ( to the tune of billions) are being sucked up by investment banks and other financial institutions at a rate of 2.5%. Those institutions are then lending the money out at 6+%. That generates income. But aren't those bank loans longer term? Like 15 to 30 years? If that is the case (and I'm probably wrong) How will the FED ever be able to end the discount window program? That would suddenly suck almost all liquidity out of financial markets.

[Jimmy058910]

It happened today and oil bombed

[StockHopper]

Yes things are bad, but is this already priced into these financials of which many are down 50 - 70% from their highs.

I say yes. Bought into UYG at close. I think the financials may rally for a few weeks.