“While we’re talking about the financial sector let’s go over and take a look at the Financial Select Sector ETF (NYSE: XLF). It, too, had a weekly downside reversal, as the up move last week peaked at 17.12 and closed at 16.36, suggesting that the (NYSE: XLF) is starting a correction. Unlike Goldman Sachs (NYSE: GS), however, the (XLF) is in generally healthy condition. The trendline from March ’09 through Feb 2010 crosses the price axis at roughly $15. So, it looks like that if the (NYSE: XLF) has more downside to go, with a test $15 ahead. If this trendline breaks, then I think it will follow the path of Goldman (GS) and test its Jan pullback lows at 13.51,” Mike Paulenoff Reports From MP Trader.

Paulenoff goes on to say, “The Bank of America (NYSE: BAC) chart resembles more the (NYSE: XLF) than it does Goldman Sachs. But it, too, had a downside weekly reversal (we’re looking at weekly charts because Goldman had such a dramatic downside reversal on a weekly basis). The peak for the entire move off the Jan ’09 high occurred last week on Friday morning, after earnings, at 19.86, and it closed the week at 18.41. To test the trendline from Jan ’09, (NYSE: BAC) will have to press toward 16.20, which is exactly what I think will happen.”

“Citigroup (NYSE: C) has a quite different chart pattern than those we’ve reviewed thus far, as its most recent high did not exceed its prior high. Citigroup (NYSE: C) basically had its peak at around 5.43 in August of ’09 and a secondary high last week at 5.07, but its low came not this past week but the week prior, when it closed at 4.55 (it closed this week at 4.56). So, from a purely technical perspective, Citigroup (C) did not have a weekly reversal. Could it and should it continue lower? My suspicion, based on the chart structure is yes, and it should test this trendline at 4.17-4.20. Should it hold, chances are Citigroup (C) will be a buy. If it breaks then Citigroup will test its major trendline at 3.44,” Paulenoff Reports.

“The strongest chart of all the financials is probably JP Morgan Chase (NYSE: JPM). However, it, too, was not immune to last week’s down move in reaction to Goldman Sachs. It had a downside weekly reversal as well, closing at 45.55, after making multi-month and multi-year highs earlier in the week at 48.20. Unless (JPM) can claw its way back above 48.20, more likely than not it will continue lower and test the trendline that goes back over a year and comes in at 41.30 roughly this week. A break of 41.30 will take JP Morgan to retest its February low at 37.02. So, what we can say in general is that we had weekly reversals in all the financials this past week. It sets the stage for downside continuation or, alternatively, a rally, which if it fails to take out the prior highs will then roll over into a more dramatic decline in continuation of the weekly downside reversal,” Paulenoff Reports.

See the rest of story including a detailed analysis video from Mike Paulenoff on financials: HERE

Here are some details we put together on the Financial Select Sector ETF (NYSE: XLF) including the bank holdings within the ETF below:

The Financial Select Sector SPDR® Fund (NYSE: XLF), before expenses, seeks to closely match the returns and characteristics of the Financial Select Sector Index (ticker: IXM). Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.

ETF BASIC NEWS, XLF