as mentioned a couple of weeks ago, my preferred proxy for the XLF short is to short the 3x long financial etf, FAS, as you get the added benefit of the time decay inherent to the leveraged etf’s in addition to the price move. however, regardless of what proxy i use to short the sector (XLF, SKF, FAS, FAZ, etc…) i will normally use the 1x tracking etf for charting purposes (patterns, trendlines, entry & exit prices, etc..). here’s the 4-hour chart of XLF with some intermediate term targets for those in the trade. like the BAC short below, this trade already has some nice gains from entry and these targets are quite a bit lower so considering lowering stops to protect profits.
note: T3 (3rd target) on the 5 min chart has been met and exceeded today. the chart below is for longer-term swing traders.
