Bank of America (BAC): How Do the Next Couple Weeks Look?

Bank of America performed strong the first part of the year by nearly doubling it's stock value in less than three months from about $5.5 to $10. We all knew that this was not sustainable. Sure enough, by the end of March, the stock began to reverse and took a big tumble back to below $7.

The 20 day moving average crossed the 50 day moving average on the last week of April. There was a downward trend, which began during the last few weeks of March and continued until mid-May. The third week of May provided the first indication of a reversal. Since then it has moved up against the 20 day moving average of approximately 8.18. The move has been relatively strong, as indicated by the on balance volume or OBV. However, in comparison with the OBV earlier in the year, it does not look strong.

Below is the eleven month BAC weekly chart.


From the below daily chart, we can see that there is strong resistance at just below $8.5. Furthermore, we can see that it is overbought at the moment with the Stochastic Oscillator at 81. In the short term, there might be some tough headwinds to overcome for this stock to shoot up. But, we will find out soon enough as earnings reports are in early July.

Disclaimer: This article is written for informational purposes only and isn't intended as investment advice.

Disclosure: I am long BAC.

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