This index has basically been trading sideways since August 2008. It came back to test support on the weekly moving average and the action of the last week confirmed this support. We view this setup as a low-risk buying opportunity for selected financials.
After a good (15%) correction, the index confirmed support on the weekly moving average. The weekly stochastic is giving a buy signal. Any small pullback next week is viewed as a buying opportunity in selected industrials.
Imperial is one of the stronger performers in the industrial sector. It came back (20%) to test and confirm support from buyers at 10.50. This is a confluance of support. We see horizontal, rising and fibonacci support near the weekly moving average. The weekly candle is a "bullish engulfing" candle that acts as confirmation of longer-term support as well as a buy signal.
