Another trade on techincals

First of all, I must say I was a bit disdaining Bernanake and did not expect that he dare to initiate the tapering of QE3, although technically he indeed did not start the tapering immediately this year as the Fed will start it in Jan. Honestly I still think the tapering won't last long as the Fed would be stunned how high the Treasury yield will go that they cannot stand anymore eventually. Likely they will return to the same level of QE3 or even higher before long. We will see.

You may notice that the crude oil has returned back to be close to $100 again. Usually, when oil turns high, the oil service sector should also be doing fine. But a divergence is occurring lately that the oil service is declining instead. However, if you study the price action chart more carefully for the oil service sector ETF (OIH), you will find an interesting pattern: right now OIH is just sitting at its long-term support line. Even more phenomenally, there are 4-5 times in the past year that OIH came down to kiss its support line and each time it turned around to shoot up. I think the chance is high that OIH will behavior in the same way again this time. I'm bullish for OIH and think it will go up pretty soon to catch up the oil price.