BNKD Is the banking crisis still simmering?
Updated
Recently, a report posted on the Social Science Research Network found that 186 banks in the
United States are at risk of failure or collapse due to rising interest rates and a high proportion
of uninsured deposits.Jun 14, 2023
BNKD, the banking bearish and leveraged ETF has dropped in trend down in the past month
albeit with some upgoing corrections along the way. GS, JPM and MS are all uptrending as an
with DPST high jumping in the past day. On the 2H chart, BNKD is in deep oversold
undervalued territory at or below more than two standard deviations below the mean VWAP.
However:
(1) the mass index indicator popped into the reversal zone and then dropped below the trigger
level of 26.5. I see this as a mathematical prediction of a soon impending reversal.
(2) the dual time frame RSI shows the lower TF blue line bounced from the lows and the higher
TF is flat not showing further weakness. I consider this a subtle bullish divergence.
(3) Importantly the red line in the sand here is the POC line of the visible range volume profile.
Price is presently supported by that line showing buyers taking a defensive stand at that level.
Overall, I will take a long reversal trade here targeting the middle of the first upper deviation
band at 12.0 with a stop loss at 8.88. This is a high potential reward of 35% for a small risk
taken. The reward on an options trade would potentially be well over 100%. I will zoom into
a 15-30 minute time frame to select a pivot low to make a more precise entry.
United States are at risk of failure or collapse due to rising interest rates and a high proportion
of uninsured deposits.Jun 14, 2023
BNKD, the banking bearish and leveraged ETF has dropped in trend down in the past month
albeit with some upgoing corrections along the way. GS, JPM and MS are all uptrending as an
with DPST high jumping in the past day. On the 2H chart, BNKD is in deep oversold
undervalued territory at or below more than two standard deviations below the mean VWAP.
However:
(1) the mass index indicator popped into the reversal zone and then dropped below the trigger
level of 26.5. I see this as a mathematical prediction of a soon impending reversal.
(2) the dual time frame RSI shows the lower TF blue line bounced from the lows and the higher
TF is flat not showing further weakness. I consider this a subtle bullish divergence.
(3) Importantly the red line in the sand here is the POC line of the visible range volume profile.
Price is presently supported by that line showing buyers taking a defensive stand at that level.
Overall, I will take a long reversal trade here targeting the middle of the first upper deviation
band at 12.0 with a stop loss at 8.88. This is a high potential reward of 35% for a small risk
taken. The reward on an options trade would potentially be well over 100%. I will zoom into
a 15-30 minute time frame to select a pivot low to make a more precise entry.
Trade active
A small move up but not enough to raise the stop-loss Holding full position.
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