$SPX, $VIX, $XLF Signal Oversold Bounce Setup

SmartReversals
03-31 07:12

$S&P 500(.SPX)$ : Be careful about being too bearish in the short term, as the $Cboe Volatility Index(VIX)$ also closed in the red.

The similarity to 2025 is impressive, especially with the RSI below 30 and the lower Bollinger Band breached; both oversold conditions that preceded a bounce.

Bounce in the making, futures gaping down create a bullish magnet for a likely bounce this week.

$Financial Select Sector SPDR Fund(XLF)$ : The Money Flow Index for the Financial Sector closed last Friday at historical lows: levels seen only 8 times in the last 25 years.

A bounce followed every single time. Today's action was constructive.

Shortest-lived spikes: 2011 (+5%) and 2022 (+8%).

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