XLF Forecast + Trading Strategies




Price Forecast:


Bearish<->Bullish




Bullish Case: The recent bullish skew in risk (154% more bullish than bearish) combined with low trading volume suggests potential for upward price movement as investor confidence grows, especially with implied volatility declining over time.




Bearish Case: High implied volatility predictions paired with a flat price action signal potential for downward pressure, particularly if economic indicators worsen or if market sentiment shifts negatively, warranting caution.




Potential Outcomes:

1) Continued upward movement (45% chance), driven by favorable economic data;

2) Limited sideways trend (35% chance) as uncertainty persists;

3) Downward drift (20% chance) if negative market conditions arise.




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October 20, 2024


Financial Select Sector SPDR Forecast

XLF        Financial Select Sector SPDR











Correlated Assets

Assets that tend to move strongly with XLF



DGRO Forecast + Options Trading Strategies   DGRO  iShares Core Dividend Growth (0.99)


FAS Forecast + Options Trading Strategies   FAS  Direxion Daily Financial Bull 3x Shares (0.99)


SPYV Forecast + Options Trading Strategies   SPYV  SPDR Portfolio S&P 500 Value (0.99)


VYM Forecast + Options Trading Strategies   VYM  Vanguard High Dividend Yield Indx (0.99)


HIG Forecast + Options Trading Strategies   HIG  Hartford Financial Services (0.98)



Uncorrelated Assets

Assets with little price relationship to XLF



PFE Forecast + Options Trading Strategies   PFE  Pfizer (0.0)


SJM Forecast + Options Trading Strategies   SJM  J.M. Smucker (-0.0)


BYD Forecast + Options Trading Strategies   BYD  Boyd Gaming (0.0)


MAT Forecast + Options Trading Strategies   MAT  Mattel (-0.01)


XEL Forecast + Options Trading Strategies   XEL  Xcel Energy (-0.01)



Anticorrelated Assets

Assets that tend to move strongly against XLF



MED Forecast + Options Trading Strategies   MED  Medifast (-0.93)


RWM Forecast + Options Trading Strategies   RWM  ProShares Trust - ProShares Short Russell2000 (-0.93)


SH Forecast + Options Trading Strategies   SH  ProShares Short S&P500 (-0.96)


SPXS Forecast + Options Trading Strategies   SPXS  Direxion Daily S&P 500 Bear 3X Shares (-0.96)


SDOW Forecast + Options Trading Strategies   SDOW  ProShares UltraPro Short Dow30 (-0.97)









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