5 Huge Stocks Ready to Slingshot Higher
Bank of America (BAC) , on the other hand, has had investors a bit more justified in fleeing from shares. From a fundamental standpoint, BofA is a bit like shoving your hand in a hole in your yard -- it might have gold in it, but then again, you might get bit by a snake. The company's balance sheet is too jumbled to judge fairly, but it does look like this stock is turning around from a technical standpoint, so investors willing to test the hole should take notice.
Right now, Bank of America is forming a double bottom, a setup that's formed by two swing lows that take place at approximately the same level: $6.90 for BAC. The double-bottom is a bullish reversal signal that signals the conclusion of a downtrend. But just because selling is stalling doesn't mean it's time to buy -- you want to see that buyers are in control first. That happens on a breakout above $8.25, the high that separates the two bottoms.
The fact that $8.20 has acted as resistance before bodes well for us -- it makes the price a likelier place for any upward bounce to stall. And because of that, a push above $8.25 means that the glut of sellers that's previously stopped shares has been completely taken out by buyers.
BofA has some risks to it. If you decide to buy the $8.25 breakout, I'd recommend keeping a tight stop loss.
Bank of America shows up on a recent list of 8 Post-Downgrade Bank Stock Bargains. JPMorgan Chase