A Feared Technical Pattern Forming On The Financial Stocks
As much as everyone would like to think that the markets will go higher, we can eat gum drops and candy canes and live happily ever after, it appears the charts are telling a different tale. Major leaders in the financial industry, namely Goldman Sachs Group, Inc. (NYSE: GS) and JPMorgan Chase & Co. (NYSE: JPM) are making one of the ugliest daily patterns a technical trader will ever see. This is called a classic bear flag. The bear flag is essentially consolidation off of a significant move which usually leads to more of the same. In this case selling. Note on the two charts below how Goldman Sachs and JPMorgan Chase had sold sharply weeks ago and now gone into a consolidation pattern which is noted by trading sideways. Technical gurus understand what this means and it can send shivers down the spine of any bull. The odds are favoring further downside on these market leading financial stocks. That means further downside in the markets as these stocks break lower and complete the pattern. To get more analysis, guidance, swing trades and education, join the Research Center.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com
