XLF - Financial Select Sector SPDR (Banks)

Financials at all-time highs but may be lagging; host notes potential but does not give a direct trade.

Financial sector showing upward moving averages and cup and handle pattern.

Gold is in a wedge pattern with support around $4,000. Gareth is watching closely for a break in either direction. If it breaks down, there is minor support at $3,900, with his ultimate major long-term buy level at the $3,500-$3,600 zone. He already holds long-term gold positions and would add at $3,500.

Banks and insurance companies benefit from higher interest rates and the current macro environment; Felix's weekly watchlist is full of bank stocks

Buffett is actively dumping bank shares due to commercial real estate exposure, private credit fund gating, and fragile consumers leaning on credit cards. The speaker suggests avoiding banks.

Banks report first in earnings season; expected good earnings with improving macro environment (lower rates, lower oil); everyone has been selling financials creating a bounce opportunity

Host says to watch XLF as a broad read on how much risk markets are pricing in. Sustained weakness is an early warning of contagion spreading beyond shadow banking.

Felix says banks are generally rate-sensitive and 'not a good place to be' in the current environment.

Extremely oversold: 0% of S&P financials above the 50-day EMA, which historically leads to positive returns over the next 2 months

Legitimate way to play bank deregulation long-term, but market has priced in expectations and near-term impact is limited. Suggested for trades at least 1–2 years out, possibly using options strategies.