The Return of the Bullish Weekly Watchlist
By Blake Young
The rally that started last week is showing some signs of staying power, which takes some of the pressure off rank-and-file retirement savers.
But we want to stay active, engaged, and that means changing it up from previous watchlists.
Financials are intriguing me right now, and they figure heavily in this watchlist…
I see the sector as a potential early reversal candidate both from a price action and economic cycle point of view. If we’re near the lows and the economy is going to stabilize in the current tariff heavy environments, financials will be part of the next bullish rotation.
The SPDR Select Sector Financials ETF (XLF), as a broad instrument, is setting up for a bullish move to $51; the potential is there to move through 52-week highs. If price clears $49 today, I would consider this a buy signal and be looking for an 8% to 15% rally in the next three months.
Big bank Citigroup (C) is experiencing a similar pattern, where price is already confirming a breakout according to my rules. I’ll be watching for C to rally $9 within the next three weeks for a 15% (or greater). Revisiting 52-week highs could bring C a 20% return.Keep in mind there’s a dividend payout coming up that could cause price to dip slightly… but, on the other hand, if you own the stock, you’ll get in on that payout.
And finally, Wells Fargo (WFC) is experiencing one of the strongest breakouts in the financial sector today – with decent volume, to boot. My price target is a test of $81 or 15% above the current price. WFC also has a $0.40 dividend payment coming up so keep that in mind, as well.
It’s too early to say confidently that all the selling and volatility is behind us, so we want to stay flexible and selective. We want to stick to rules. This Weekly Watchlist fits the bill perfectly.
