Domestic Downtrend:

There has been a noteworthy divergence with the financial group this month as the EUFN has acted very well compared to the XLF. Although both the EUFN and XLF are in the bear market territory of being about 20% from their most recent 52-week highs the EUFN has started to act superior. Over the last one and three-month time frames the EUFN is shining up 2 and 11% whereas the XLF is down 5% in the last month and up 2% during the last 3 months. The largest holding in the XLF will have a lot of sway as to what happens in this relationship as it battles with the very round 300 number here and attempts to remain afloat above its 50 and 200-day SMAs. If it can regather itself a 319.01 double bottom pivot is making its presence felt. There is a striking difference in PRICE action of the number 2 and 3 components in JPM and BAC too. JPM is off less than 6% over the last 3 weeks as BAC is down 17%. Keep in mind the dividend yield for the EUFN is well above 4%, double that of the XLF.

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