Finnies Swimming Upstream:

The financials have not received the praise they deserve with their nascent move higher. Looking at the XLF chart below shows constructive activity, and the ETF is over the last 3 month period the second best of the 11 major S&P sectors. It has been bested by only energy during that time frame, proving that the barbell approach was profitable in 2020. Perhaps on a minor level, uncertainty still remains as banks are dealing with an increasingly negative interest rate world, and that has never factored into their models. But that may be why the opportunity exists, as investors take advantage of the uneasiness. Remember too it is a diverse group with insurance names acting well (IAK up 16% in last 3 months), asset managers behaving bullishly, fintech and credit card names all pulling their weight. The XLF chart is visually pleasing, and the top component in BRKB not traditionally thought of as a bank, is nearing a 50 day SMA retest for the initial time following a double bottom breakout above a 217.53 pivot on 11/9. Often an ideal entry point.

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