Banks just had their worst week since 2011. It could get even worse for the broader financials sector, says one technician.
div > div.group > p:first-child"> The KBE bank ETF fell 9 percent last week, while the broader-based XLF financial ETF tumbled nearly 5 percent. Bank stocks are now in a bear market, having fallen more than 20 percent from a June peak, while the financials tumbled into a correction with losses of 13 percent from their 52-week highs.
"We're still underweight financials at this point in time," Johnson said Friday on CNBC's"Trading Nation.""We're still making a series of lower lows and lower highs in here, and from our perspective the recent price action since December has been nothing more than a relief rally." "We're not interested in the banks. You look at a lot of these individual company charts, again they also look like relief rallies, and they look like they're about to roll over, and the yield curve is still very concerning and a headwind for the banks," said Johnson."The underperformance of the banking sector has really started to accelerate since the Fed went dovish," Binger said Friday on"Trading Nation.
"The spread they're going to make on the loans they can give out or will give out is going to be compressed, so banks are going to struggle and be quite challenged for growth," said Binger.
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