New All-Time Lows For Banks Relative To The Stock Market

JC Parets
February 16, 2020

It's been a while since we've had a conversation about new all-time lows for stocks. But this week we saw the Regional Bank Index Fund close at new all-time relative lows. This is the lowest they've ever been.

What's fascinating is how this is happening just as the Financials Index Fund is attempting to break out to new all-time highs, finally exceeding their 2007 peak before the financial crisis.

Here in this chart you can see the $XLF trying to finally get through those 2007 highs for the first time ever. But Regional Banks are not confirming these new highs. Neither is Momentum or Relative Strength.

Is this really the breakout in Financials we've been waiting for now almost 13 years?

Here's the chart that has me thinking that this is NOT it. Regional Banks just went out at new All-time lows relative to the S&P500. Is that something you're likely to see right before a historic breakout in a sector?

I'm just not seeing it yet. And if the market has taught me anything over all these years, is to let it show us. Let's see it.

JC what's it going to take to get you bullish and buying stocks again?

Well, Financials breaking out to new all-time highs, for one. Regional Banks not crashing on a relative basis would be another one. This, to me, is part of the interest rates story.

Do you want to be buying something making new all-time lows, relative or otherwise?

I don't.

JC

 

 

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