Will Regional Banking Continue To Grow As The Market Holds?
Michele Schneider | Nov 11, 2020 11:46PM ET
On Tuesday we looked at the Economic Modern Family as either hiding or holding their ground.
Wednesday's price action shows that at least for now we are holding, as Russell 2000 (IWM), Transportation (IYT), Regional banks (KRE), Biotech (IBB), and Semiconductors (SMH) are currently trading inside the range from Mondays high and low.
KRE has been the largest underperformer in the Family, but with it’s recent breakout in price, it could give us some great opportunities as this sector is finally building momentum to the upside.
Above is a weekly chart of SVB Financial Group (NASDAQ:SIVB) which is one of KREs top holdings.
Interestingly enough while KRE has been stuck under the 50 week moving average, SIVB was able to clear it long ago and now looks for a phase change as the 50-WMA will cross over the 200-WMA soon.
With such a large run-up it can be tough to find healthy risk to reward from a longer term perspective, but if money continues to rotate into this sector then its outperformance from the other holdings makes it a good company to keep on our watchlist.
Another top holding is Truist Financial Corp (NYSE:TFC).
Sitting right upon the 200-WMA, TFC has been able to outperform KRE which is still sitting between the 50-WMA and 200-WMA in a recovery phase.
While the regional banking sector along with the rest of the market is still digesting its move from Monday, keeping an eye for building support in this sector could make for some great plays as more money flows into this area.
S&P 500 (SPY) Back over Mondays low with Support 354.
Get The News You Want
Russell 2000 (IWM) 169.33 Support.
Dow (DIA) 291.40 Support. Lots of digestion from Monday.
NASDAQ (QQQ) Bounced off 10-DMA. Major support 280.
KRE (Regional Banks) Support 45.22
SMH (Semiconductors) Strong close with support range from 187 to 190.
IYT (Transportation) Needs to hold gap from 206.66 or could see break back to 203.40 the 50-DMA
IBB (Biotechnology) Finally made a higher close from consolidation at 137 area.
(XRT) (Retail) Almost no change from yesterday's close of 54.67. But still holding.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.