NEW BULLISH Plays
Bank of America - BAC - close: 8.15 change: +0.15
Stop Loss: 7.90
Target(s): 9.25 or 9.75
Current Gain/Loss: unopened
Entry on August xx at $ xx.xx
Listed on August 20, 2011
Time Frame: 6 to 9 weeks
Average Daily Volume = 103 million
New Positions: Yes, see below
Why We Like It:
Financial stocks were showing relative strength on Monday. Believe it or not BAC was near the front of the pack with a +1.8% gain. Shares are past round-number resistance at $8.00 and now they are approaching resistance at $8.20.
You could argue that BAC has created a "W" shaped bottom over the last few months. A breakout higher could launch the next major move up. Bears will argue that BAC is overbought after a five-week rally. That's definitely true but stocks can always get more overbought.
I am suggesting a trigger to launch positions at $8.25. We do want to keep our position size small to limit our risk. Our target is $9.25 or $9.75.
Trigger @ $8.25
Suggested Position: buy BAC stock @ (trigger)
- or -
buy the 2013 Jan $9.00 call (BAC1319a9) current as $0.43