There is a clear and crisp head and shoulder pattern on the chart of the Financial Select Sector SPDR Fund (NYSEARCA:XLF). For investors who do not know, a head and shoulder pattern is very bearish
. For the massive downside to occur, the neck-line needs to be broken. Please be aware, the neck-line has not broken yet Financial Select Sector SPDR Fund, so there is no immanent danger, but based on the chart, it is likely it will happen in the next week. When the neck-line triggers, the XLF
will drop from its current $23.40 to $21.00. This spells major downside on financial stocks like Goldman Sachs ( GS
) and JPMorgan Chase ( JPM
). This should be very concerning for investors in relation to the overall market. If the financial stocks fall sharply, the market will be taking a beating.