Buying Weakness in XLF

XLF recently experienced 5 consecutively lower closes. The following is a look at what happens historically when this weakness is bought and sold x days later:
As long as the trade is short term, consider using XLF to generate your signals and using SKF, UYG, FAZ, or FAS for the trade.

Banks going lower

Trading the banks these days isn't my idea of stress free, nonetheless, over the last 18 months it has been rather profitable to short them every time (actually only 80% of the time) they get overbought. Eventually all the banks will be trading at zero so naturally this trade cannot last forever but I think it still has some room to run. I mean, BAC is still at 3.95! That is an insult to your intelligence.

Shorting strength in names like XLF, KBE, UYG, and even in some of the individual names like JPM and GS has performed nicely.

KBE


Unless you have done your homework, I don't recommend the inverse - buying oversold dips - as long as the banks are under their 300 day MA.