Financial Sector Analysis & Trade Ideas 6-17-26

Here is a detailed summary of the “Financial Sector Analysis & Trade Ideas” video from Right Side of the Chart, published on June 18, 2026:

FOMC Meeting & Macro Outlook

• The New Fed Chair: The speaker shares criticisms of the newly appointed Fed Chair, describing his first press conference as filled with political “lip service”. [00:14].

• The Fed’s Mandate: While the Fed insists it has the tools to hit its 2.0% inflation mandate, the speaker notes inflation has been running far past that level for quite some time [02:02].

• Bond Market Dynamics: Long-term Treasury yields have continually moved up despite successive rounds of 25–50 basis point rate cuts in late 2024 and 2025 [03:24]. The “bond vigilantes” are driving rates to multi-decade highs, reflecting an underlying shift into a secular bull market for interest rates [06:00].

• The Fed is “Castrated”: The speaker argues that raising short-term rates may eventually be required due to inflation, which will stifle growth, reset corporate paper valuations, and cool down the AI/semiconductor bubble [28:24].

Market Indices & Volatility

• QQQ & SPY: Both the Nasdaq (QQQ) and S&P 500 (SPY) short positions remain active. Recent counter-trend bounces served to backfill early June gaps [12:15], which technically clears the path for a further downward move toward a projected 15% drop target, especially if  the recently hit first price target zone (T1) on the 60-minute chart of QQQ is taken out [13:08].

• VIX: The volatility index had a sharp 53% spike off its recent low to hit its initial target of 23.19 [14:50]. However, the speaker stresses the VIX won’t truly scream until the broader financial sector breaks down [15:50].

Financial Sector (XLF) Deep Dive

The speaker notes that an index is simply a sum of its parts and breaks down various subsectors:

• Credit Services (Visa/Mastercard): These stocks are acting as a proxy for a weakening consumer [21:36]. Visa and American Express are facing heavy technical resistance after losing their 200-day moving averages [20:07, 21:06].

• Banking Sector (BKX & Regional Banks): Large banks and regional banking ETFs (IAT, KRE) are flashing massive, multi-month negative divergences [23:17, 25:52]. While they continue to wedge upwards, a definitive break below support is required to trigger macro sell signals [24:42].

• Specialty Finance & Mortgage Companies: This sector exhibits a bullish falling wedge pattern [27:38]. Short trades on names like Rocket (RKT), PennyMac (PFSI), and UWMC previously captured large profits and are being watched for a final flush out to potentially reverse long if Treasury yields drop [31:43, 32:21].

• Private Equity & Private Credit: The speaker issues a strong warning against Business Development Companies (BDCs) and private credit [39:52]. He reiterates his previous prediction of a vicious cycle of redemptions as retail investors continue to pull capital out during limited withdrawal windows, forcing companies to mark down their “fantasy” asset accounting to actual market rates as current loans are sold to meet redemptions, thereby re-pricing holdings across the sector to more closely represent their actual value [42:43, 44:19].

• Insurance (IAK): Deemed a “dead money” sector [45:47]. The speaker officially cancels active long targets (T2 & T3) on Progressive (PGR) (while still keeping/targing T1) due to overhead 200-day moving average resistance and deteriorating setups in other major industry components like Chubb (CB) and Travelers (TRV) [46:17, 47:04].

Next Steps: The video concludes with the speaker planning a follow-up video dedicated entirely to tech stocks and the semiconductor sector, as the broader financial sector finishes setting up its macro breakdown [52:07].