Monday, June 23, 2008


SKF (double short US financials) is setting up to test new highs.

Click on and take a look at the simple line chart i included as an image here.

Notice that the price is following the volume. Now that the double short is breaching 140 it is in rarified air. The financials are clearly breaking down to new lows.

What will be VERY VERY interesting to see is if the Federal Reserve, Congress, President, Banks themselves, Treasury Department, BOE, Chinese, Pope or *someone* can engineer another "sticksave" to keep the bottom from falling out on these.

*If they can*, what we are going to be looking for is another "smaller cup" to the right of the existing "cup", accompanied by lower volume at the bottom of the cup.

THEN, if we see that and another ramp toward 140 the breakout will be a classic "cup and handle" (aka, an "inverted, inverted cup and handle" :) ). Right now we just have a "cup" -- which isn't a terrible formation with the curved bottom, but statistically (supposedly) not as "predictive" as the venerated cup and handle.

go cool,

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