There's Something Strange in the Neighborhood

Throughout last week we chronicled the potential bull rotations into the banks and homebuilders, especially. However, last Thursday we noted the sharp reversal of fortune with downside moves after green opens in the XLF, financial sector ETF. 

As a result, inside Market Chess Subscription Services we entered FAZ, the triple-levered bearish ETF of the financial sector at-large, at $10.42, playing for the bearish turn of events to follow-through lower (I took some off at $10.85 this morning, but am still holding at the moment). 

And as opposed to the many times in this bull market when bearish reversals would amount to either a stalemate of a trap to lure in shorts as the market then catapulted back higher, this time the owned reversal in the financials is playing out a bit more by the book. One of our "tells" inside the services last week was price action in Goldman Sachs, which telegraphed the reversal in financial perfectly on Thursday. 

On the updated XLF daily chart, below, as long as price now holds below $25.12 the failed breakout is very much in play.