Is the financial sector likely to outperform the market?

The chart we publish this time shows the relationship between an ETF of the Financial Sector and the S&P 500. It shows the relative value of the Financial Sector versus the market as a whole. The graph is quite clear: the trend is downwards, though it seems it´s slowing down a bit. We cannot trust this stop. In fact, we think it´s taking some time to overcome the awful oversold level we saw at the end of 2009 (check out the oscillator below). Probably the trend will continue after a short pull-back to the previous minimum (this August). A good bearish entry could be when we see the oscillator heading South again.