Large Banks Are The Strength Today

Today the major indexes have been up, down, and all around. This is typical trading during options expiration week. While the major market indexes are all lower on the session they have bounced sharply off the lows of the day. Believe it or not the sector that is showing some strength today is the large financial stocks. Since the middle of April the financial stocks have been battered and beaten. However, today the Financial Select SPDR XLF traded down to it's flash crash low area at $14.60. This area should be short term daily chart support for the sector. Other notable financial stocks that are trading higher on the day are Goldman Sachs Group Inc GS, J.P. Morgan Chase and Co JPM, Morgan Stanley MS, and Bank Of America Corp BAC. Should this group continue to trade higher on the session it is possible that it can lift the other sectors of the market. However, it is important to remember that the European banks have been bailed out by the ECB and the IMF with $1 trillion. Outside of the three day rally on May 10th - 12th the bailout package has very little effect on the markets. Therefore, it is prudent to remain cautious in these dangerous waters. Nicholas Santiago Chief Market Strategist www.InTheMoneyStocks.com