VSheart of the week – Bank of America
Bank of America risks medium-term pullback in major uptrend
Medium-term technical analysisclick to enlarge the graph
Time stamp: July 11, 2021 at 1:00 p.m. SGT
Source: CMC Markets
- Since its recent current high of 43.48 released on June 3, 2021, the Bank of America (BAC) share price has fallen -11.5% to an intraday low of 38.48 on July 8, last Thursday. . BAC will announce its second quarter 2021 results on July 14, Wednesday before the opening of the US session.
- The BAC has continued to trade below its 50-day flattened moving average for the past three weeks, accompanied by the daily Relative Strength Index (RSI) which has remained below a corresponding significant resistance at the level of 58%. These observations suggest the absence of bullish momentum and BAC still faces the risk of a further potential corrective decline in the medium term (several weeks) as part of a major uptrend phase in place since the March 23 low. 2020 at 17.95.
- Watch the key medium term resistance at 42.05 for a potential drop to retest 38.48 and a break below could cause a further drop to the next support at 35.70 (Old December 27, 2019 range resistance, 38.2% Fibonacci retracement of multi-month uptrend from September 24, 2020 low to June 3, 2021 high and 200-day moving average).
- On the flip side, a daily close above 42.05 invalidates the corrective bearish scenario to pave the way for another sequence of impulsive bullish moves to target the next resistance area at 45.00 / 45.35 ( a group of Fibonacci expansion levels).