Financial stocks like Goldman Sachs Group, Inc. (NYSE:GS) and Wells Fargo & Company (NYSE:WFC) may have just a little more left in the tank prior to a significant pull back. Note the chart below of Goldman Sachs. It shows key resistance points nearing but not yet hit. This is by no means a signal to buy but more of a signal to wait to short. Once these key levels are hit, then a winning short is much more likely. The financial stocks may hold up decently into the end of the year as the Federal Reserve continues to prop the markets up. An artificial asset bubble is exactly what the Federal Reserve has been aiming for and created. The creation of this bubble makes the average American feel richer when they look at their investment accounts thus more likely to spend. The spending then, is supposed to create a true rebound in the economy and ultimately cause hiring. Is fooling the American people the true way to go about it? Is making food and energy prices spike the real way to make people richer? What about those that are poor and cannot afford to invest? Are they left behind and suffer more? All these questions and more will be answered in the coming years.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com
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