On Friday I mentioned that it would be the commodities that would lead out of the bear market and that any gyrations in the Financials, etc... would be just noise. I should clarify that even though I said commodities would _lead_ there has to be participation from other important sectors as well. I like to watch the financials and transports as well to gauge the overall strength of the market.
While I personally do not believe the bottom has put in, there are _tradeable_ bottoms. Anyway, the graph shows the XLF and IYT. Friday the XLF put in a strong close above the 20 day SMA and appears to be building on those gains this morning. The IYT did close above the 20 day but with less momentum. It's completely realistic to see these run up to the falling 50 day SMA. But until I see the CRB making a meaningful move to the upside I will remain skeptical and treat for what it is, a bear market rally.
