Click on the picture above for an annotated chart of XLF with two Fibonacci retracements added.
If that's too much for you, here's what I wrote on the chart:
XLF popped today. It almost retraced 38.2% from its recent low of $6.85 using the recent February high of $10.09. The 38.2% retracement from the late-January high of $10.51 is $8.25. Using this data, I thought it prudent to initiate a position in FAZ late this afternoon at $56.93.
XLF closed at $8.05 after Bernanke downplayed the federal government's desire to "nationalize" banks. He used the term "public/private partnership" and the market liked it.
The financials were also extraordinarily oversold, so Fozzie is back in the portfolio on today's pop.
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