The Pivotal Perspective has been all over the move in financials, noting that they looked among best new entries before the jump (check featured posts). 11/9 Daily SPY comment proclaimed them new sector leader (I view IWM small caps as a "main index).

How high can they go? Here's a full chart workup.

First, let's choose which financial ETF/index to view. The most common seem to be XLF, IYF, KRE and the IWM index. These are all slightly different. Thus far it looks like the index is giving the clearest signals so I'll use that today, though the trading vehicle that matches this is IYF.

Sum
Longer term gains likely, near term digestion and consolidation bit more likely; for now the level to watch is YR2 / Q4R3 combo. If that looks like resistance and TLT reclaims Q4S3 then I still think that hedge idea could work. But given that we are heading into year end, and everyone wanting to be long banks, I don't think financials will drop too much.

IXM Q
Nothing wrong with this launch. I'm sure Wall St will be cheering for this to reach 2007 highs at some point.

IXM M
When we add the Fib grid we see the significance of this breakout, which is also clearing key 61% resistance from 2007 high to 2009 low. RSI not yet overbought. That 255 level is history.

IXM W
Power move outside weekly BB and above RSI 70. This will digest at some point to let time catch up with price.

IXM W
Picture perfect move from YS2 to YP, down to YS1, YP support, fast move to YR2.

IXM D
11/4 low bang on YP; 11/14 high on YR2. Maybe the fastest move from YP to YR2 I can recall. RSI peak of 85 is awesome.

Financials have been the news recently as banks have been selling off. What is The Pivotal Perspective on this sector?

First of all, take a look at the plain XLF chart without any pivots. See that spike low on 8/24/2015? Well that low goes into the calculation of the yearly and half yearly pivots for 2016. So I'm less certain than they will work as usual.

Example: we are in a situation where XLF is down quite a lot, but unlike almost everything else it hasn't reached its YS1 yet.

While we can watch to see if those levels activate any programs (the spike on 8/24 sure does), it may also be worthwhile to watch the S&P Financial Select Index or IXM. This did not have the same spike low, and I think the pivots "should be" more accurate. Its long term pivots are on the next chart below. As you can see, it is already below the YS1.

Here's the standard view including both long term and medium term pivots. The 1/20 low was on Q1S2.