Banks Have Not Participated In This Rally

Here's a group of stocks I will be watching in the days to come as potential shorts.

Above is a daily chart of the BKX (banking stocks). Below that is a ratio line of BKX vs SPX. Notice how the red line is trending downward which indicates how weak these stocks are compared to the S&P.

In the lower pane is the MACD oscillator which is already on a sell signal.

I have no short position in these stocks at the moment but if the BKX can break the trendline or move below 116, I may consider shorting this group.

The reason I'm posting this chart now even though I have no position in these stocks is because anybody can write a post AFTER the fact once there is a big move in the market. That's useless information to you. What I've always done was share with you what I am looking at BEFORE these stocks make a move so that maybe you can anticipate what will happen and plan accordingly.

I think part of being a good trader is having a game plan and then taking action if the market proves you correct in your analysis. If the bank stocks explode higher from here I will do nothing but if I see some weakness coming into this group I will consider shorting these stocks.