The Financials ETF XLF surged much higher than predicted last week. There was no headfake from last week’s breakout above the $24.81 level. The stronger than forecast performance on XLF means that the prediction chart needs to be revised.
The stronger than expected performance above the $24.81 level means that any kind of pull back will likely retest $24.81 support. XLF will likely move sideways until November.
The FOMC statement last week is why financial stocks did so well. After Wednesday’s FOMC comments, traders are betting that there is a 63.8% chance of hiking rates in December.
The next few weeks should see XLF pull back to test the $24.81 level.