Get started

Regionalbanks

$KRE massive H&S top?Thanks to @TORNADOF5 for reminding me about this. A friend sent me a tweet last night about how banks are levered up on debt and that prompted me to look at the chart of KRE. As you might remember, AMEX:KRE was one of the worst performing ETFs at the beginning of this year with the failure of a ton of local banks. But since earlier this year, I haven't heard much talk about banks being in trouble. Well I pulled up the chart, I was surprised to see a massive H&S top forming. If price breaks $37-38, then I could see a big move down. The first target would be $29 and if price gets under that, it could get really bad. Could see price making it all the way to the lower support levels. Let's keep an eye on this because it'll be a great trade should it play out.
AMEX:KREShort
by benjihyam
3
NYCB could bounce back from the inflation report LONGNYCB on the 30 minute chart had an abrupt reaction to the inflation report. This is not a surprise. Many traders and investors know that banks make more money when the prime rate is lower because they do not need to pay much on savings accounts and deposit certificates. NYCB has been challenged and is more volatile than the average bank stock being a penny stock with hard fundamental issues. NYCB has reversed and the relative volume indicator shows the flip. Price has climbed back into the lower part of the high volume area of the profile which shows some bullish momentum. I see this as a risky long trade but still take it for the quick 6-7% upside back to the POC line of the volume profile. The stop loss will be the low pivot of the prior trading session.
NLong
by AwesomeAvani
NASDAQ BANK INDEX ready to reverse ? LONGBANK is tracking bank stocks within the NASDAQ. I cannot find if it is market cap weighted or instead an unweighted composite I wanted to check this out to see if the banking sector might reverse and perhaps have some trade candidates based on relative strength or even rising trading volumes. On the 15 chart, BANK's price is in a descending channel or wedge. It is too early to tell if it is breaking out although it is sandwiched between the SMA10 and SMA20 as so in limbo at least of this time frame. The MACD indicator shows downgoing lines that had crossed one another above the histogram. This appears to be a bearish divergence. The mass index shows no signs of a rise into the threshold and trigger zone as it did on January 31st. Overall, I conclude that the price is still in the channel and not yet an early breakout. I will recheck this at intervals. Once a breakout is confirmed and even retested, I will find some relatively strong bank stocks from which to pick a long trade at a low pivot for a safe high return from the upside shown.
BLong
by AwesomeAvani
1
Bearish potential detected for KRELooking at KRE during the final hour of trade this morning on the US markets, KRE represents a potential bearish opportunity should momentum continue and lower highs and lower lows be made past the current position, considering breach of recent support levels aligning with technical indicators of RSI and DMI. Personal stop loss for the trade would be the high of the recent swing on 17-Oct (i.e.: above the high of $42.92) and will track the declining 30 day moving average as the trade continues.
AMEX:KREShort
by Ivory_Wolf
Regional Banks Are Still in Serious Trouble!Traders, For the second time this year, regional banks are threatening to cross on over an essential support that has carried us through this secular bull market for 14 (going on 15) years! If our support breaks, I fear that regional banks could drag everything else down with it. Remember, it is regional banks that hold the loans for much of commercial real estate. Much of commercial real estate went vacant during COVID. We are only now beginning to understand the wave of bankruptcies that are crashing in hard as a result! Watch this line closely or stay tuned here and I will keep you up to speed as I observe any significant changes. Stewdamus
AMEX:KREShort
by stewdamus
Charles Schwab - The Harbinger Of The Next Crisis?While I believe that the markets are currently standing on the edge of a cliff and will not produce a new all time high, it's very important to note that price action is yet to confirm that, with the most significant catalyst of them all being Wednesday's FOMC. Wednesday's FOMC is important because whether the Fed hikes again and how much they hike will determine what happens with bond yields, which determines what happens to bond prices (inverse correlation), which determines what will happen with the U.S. Petrodollar. There's no FOMC again until September. I discuss what I think will happen this week in the following call: ES SPX Futures - Welcome to FOMCmageddon Charles Schwab is an important piece of the U.S. banking structure because it's the 10th largest bank in the country. When you take a look at recent price action on banks, everything seems to be going pretty well, and it's almost as if the Silicon Valley Bank crisis never happened. SIVB's demise, however, was a really significant canary in the coal mine because that particular bank was not only one of the largest in the country, but a major intermediary between the West's venture capital community and the Chinese Communist Party. You just absolutely have to keep an eye on what's going on with China and the International Rules Based Order right now, because everything "Taiwan War" is really talking about how the globalists can take control of China as the CCP falls. Based on this, I think Taiwan Semiconductor is a significant long hedge right now because it's not a component of the U.S. indexes, and is a world leader in silicon wafer production: TSM - Taiwan, Your Semiconductor Long Hedge China is the world's 5,000 year country and has huge natural resources and a huge population of very sophisticated people, so it's a target. If Xi Jinping is smart, he will weaponize the 24-year persecution, organ harvesting, and genocide against Falun Dafa's 100 million believers to protect himself and the Motherland. But if he does this it means that the entire world will quickly be implicated in the Nero-like persecution of spiritual cultivators of an upright faith. The impact on the markets, our society, and our reality will be extreme. And oh so hard to bear. I can only say if you want to be long at this point, you need to be hedged long on volatility or you might die. VIX - The 72-Handle Prelude The enormous Schwab dump from March, which you primarily see was a fully manifested failure swing only on the monthly bars: Was spurred on by the banking crisis, which served as a prelude to the very significant bear market rally we've had. Now everyone believes new highs are in order and everything is going to be fine. It's time to go long, go on vacation, and collect money while being hammered in a speedo at the beach with the other men. What a painful hangover. The problem with the more up more right now crowd's thesis on Schwab is that the entire range above where we're at, and we're already flirting with the 79% retrace of the March gap down, was already filled, which we see on the weekly: Moreover, there are two significant price action problems with the bull case from a market maker perspective. The first is that Schwab dumped to exactly $45.00 in the first place. Computers don't like preserving round numbers and people just love to put stops under/at psychologically significant whole numbers. The second is that the COVID dump was likewise $28.00. And for the same reasons, that's even more dangerous. I am predisposed to believe that Schwab is likely to be the next Credit Suisse-style big short, and may even be the vanguard for the next crisis that would take us under SPX 4,200 and towards 3,700 in accordance with the new JPM collar, which I discuss below: SPX/ES - An Analysis Of The 'JPM Collar' As for what the fundamental story will be, it's very hard to say. But let's compare Schwab's monthly bars you see above to some other top 10 banks: Bank of America Monthly Does not show any indication of failure swings and really just looks like a healthy retrace. While Wells Fargo does not look strong enough, it also does not yet indicate a real short setup on higher time frames And this is even more true for JP Morgan And Goldman Sachs Which can be, at worst, only be said to be setting up for the first leg of a failure swing. At worst. And thus it is extremely notable that Charles Schwab is as weak as it is. My call is the thesis that the optimal short entry is already here, with some kind of flirtation with the $70.00 mark due for FOMC. And if Schwab and the banking sector and the equities sector are truly bullish, that would be great, but I still expect a stab back into the "wick play" area before it would move to set a new all time high, which means $69 to $50 is really quite the win if you're short and quite the loss if you're longing the top or haven't taken profits. If Schwab and the banking sector are really the catalyst for something as disastrous as Nasdaq 9,000, then the target is under $28 and you're more or less standing on the edge of The Big Short. Right now, with the VIX as suppressed as it is and price as high as it is, January '25 $55 puts are only $3.7~ with at the money puts being $8.3~ Just selling them on a flirt with $50 again, let alone $44.99, is already a big win. Humans never believe in anything until they can see it. It's one of their worst deficiencies.
NYSE:SCHWShort
by LordWrymouth
$IWM Outlook 05/30 - 06/02 @capgainsgroupAs the S&P 500 and the NASDAQ rally into the green for the year, the Russell 2000 (aka the small cap index) has lagged behind and is barely green at +1.03% YTD for 2023. One of the reasons why this index hasn’t been doing well can be attributed to the index’s 15.18% allocation in the Finance Sector. Failing regional banks such as Silicon Valley Bank ( NASDAQ:SIVB ) and Signature Bank ( OTC:SBNY ) haven’t helped the index much. Investors who would like to play the Russell 2000 should pay attention to the 5 major sectors that makes up 73.23% of AMEX:IWM : Health Care (17.62%), Industrials (16.66%), Financials (15.18%), Information Technology (12.74%), and Consumer Discretionary (11.03%). Technical Analysis: AMEX:IWM recently formed a Death Cross (50 SMA x 200 SMA) on the daily chart in mid April. Although not very clean, there is a support uptrend line dating back to October 2022. Also, it seems like we have a head and shoulders pattern, using the Daily 170.30 level as the neckline. Bulls will want price to reclaim the weekly 178.90 level as a support. I lean bearish on this index. If AMEX:IWM can’t reclaim the two daily gaps above, at 176.74 - 177.42 and 180.53 - 181.28, I expect it to come down and test the yellow uptrend line and potentially break it to the downside in the coming weeks. Upside Targets: 176.74 → 177.42 → 180.71 → 181.28 → 183.76 Extended: 186.91 Downside Targets: 174.09 → 172.33 → 171.41 → 170.30 → 169.32 Extended: 166.81
AMEX:IWMShort
by peterjames_6
They Will Protect the Banks, FRC is a LayupFirst Republic bank has been slaughtered due to the banking crisis in the US. FRC is backed by JP Morgan, the strongest bank on earth. Unless the Gov't wants all regional banks to fail and roll it all up in to the big banks, FRC should survive and if it survives, it can easily double from here. Obviously the sentiment on this stock and bank stocks in general are terrible right now, we'll see if that changes. If the stock falls into the single digits from here I will close the position.
NYSE:FRCLong
by inanis_
BOH Bank of Hawaii Is this a safe short?BOH has been in a downtrend for 2 months since the very beginning of the small bank crisis all precipitated by the fed and its rate hikes confounding the value of bonds with fixed yields. As can be seen on the 4H chart, price was in consolidation in January and February but the dropped out of the supply / resistance zone which is quite thick by the Luxalgo indicator. Price hit another consolidation range at about $ 50 and then moved lower as the banking crisis was temporarily stabilized but then took another downside leg. the moving averages show price underneath both the EMA 100 and EMA 20 while also in the range of three standard deviations below the mean anchored VWAP. the EMA100 and the mean anchored VWAP provide confluent super-trend direction. Support is breaking down; Price is in the deep undervalued area and has not stabilized where it is. As such it bargain hunter's dream but more likely a solid and sate shorting candidate. I always keep in mind if a catalyst such as federal rescue measures comes into play, and price reverses above say $36.00 some buying momentum could come into effect especially if short sellers need to cover their positions to out with a small profit or loss. This play would have far less liquidity than PACW but perhaps more room to the downside from which to realize profit.
NYSE:BOH
by AwesomeAvani
Regional Banks are telling us everything about this market!Traders, Though, I've expressed this all along this past year, regional banks are now confirming everything I've stated regarding JPOW and the FED only having two choices about the future of the U.S. economy: deflationary recession/depression OR hyper-inflationary recession/depression. The line in the sand has been drawn and crossed. Should the FED attempt to rescue the economy by pausing rates or even pivoting, we'll likely see hyper-inflationary recession at the very least. On the other hand, should the FED continue to focus on tackling inflation, then recession it is. Watch this chart closely along with our DXY chart. They are currently leading EVERYTHING (stocks, crypto, commodities, real estate, everything). Stew
AMEX:KREShort
by stewdamus
When Fear Reigns Banking Majors GainIn times of crisis, investors rush to safety. When risk shows in places of safety, bank runs begin. One's pain is someone else's gain. Silicon Valley Bank (SVB) & Signature Banks' combined assets at $300 billion is witnessing a flight to safety. At $300 billion, it is trivial relative to $23 trillion within the American banking system. Remember that the FDIC only insures deposits up to USD 250k. Both institutional and individual clients holding large deposits in regional banks are rushing to move their funds from regional to major banks. Between 2020 and 2022, regional bank index outperformed the broader bank index. Regional banks business was designed to be lean - collect deposits and extend loans to home buyers and local businesses. This was meant to be less risky relative to banking majors whose businesses were sophisticated and inherently risky. Hence the banking relief law passed in 2018, made regulations less onerous to banks with domestic assets of less than $250 billion. As a result, by end of 2022, US had 2,100 banks with $19.8 trillion in assets. Only ten out of these 2,100 banks had domestic assets more than $250 billion. Lax regulations led some regional banks astray with concentrated bets on customer segments and risk management of asset and liability maturity risk. With rates rising, tides receding, banks that were swimming naked became obvious. Chart below contrasts the impact of unrealised losses on select US bank's tier 1 capital ratio. It is little surprise that SVB imploded with such an adverse capital situation when unrealised losses were accounted for. Now as crisis of confidence in banking spreads across both sides of the Atlantic, depositors are rushing to move their money to larger safer bank and money markets. FT reported on March 15th that large US banks are getting flooded with fund transfer requests from regional banks. SVB has triggered a tectonic shift in depos­its unseen in more than a decade. Veteran hands know well that anxiety created by small shocks make larger crises less likely. JPM, Citigroup are among the beneficiaries of regional bank pains. To aid cus­tom­ers to move depos­its swiftly, these banks are tak­ing extra steps to speed up client onboard­ing. It is reported that these banks are reassigning employees to account opening linked jobs to handle workload and to hasten the process. HNI’s Shifting to Large Banks Despite the liquidity backstop promise extended by US Fed and US Treasury, depos­it­ors are moving funds into lar­ger banks such as JPM, Citi and Bank of America. This phenomenon is more so for accounts holding >$250k (the limit up to which is guaranteed by FDIC). The 25 biggest US banks gained $120B in deposits in the days following the collapse of SVB and Signature while smaller banks saw a net outflow of $108B during that period. This has been the largest weekly decline in deposits at small banks and poses the risk of inciting more financial instability. Citi’s private bank servicing wealthy individuals is opening accounts within a day com­pared to usual timeline of one to two weeks. Citi is reported to open accounts & initiate fund transfers even as new clients are under compliance checks. Larger banks are subject to significantly tougher regulatory scrutiny as a result they become attractive destinations for shell-shocked depositors. Portfolio diversification is not new. Long shadow cast by the debacle of three sizeable banks within a space of a week has exposed the fragility in the system. This has prompted depositors to diversify not only their portfolios but also their banks. Moreover, comparing the actual assets held by large banks to mid-sized banks: SVB and Silvergate, both of which collapsed had their assets largely held in bonds held to maturity or available for sale. For SVB, the maturity date was in the far future, posing liquidity concerns when a bank run ensued. By contrast, Silvergate largely had bonds available for sale but selling them all at once would have caused huge realized losses. Another interesting takeaway is the way in which each regional mid-sized bank adopts a different portfolio tailored for their specific clientele and their needs. Although, this allows them to fine-tune their operations and holdings, it comes with the downside of financial instability during periods of aggressive rate hikes and economic uncertainty. By contrast, Citigroup, JP Morgan, BoA, and PNC have portfolios that are well diversified with a healthy mix of cash & interbank loans, loans, bonds to maturity, and bonds available for sale. Crucially, their significant cash holdings allow them to weather the storm far better and eases any liquidity concerns for depositors. Capital Flow Towards Asset Managers Large asset managers are also witnessing an influx of funds. Seemingly the money is moving away from regional banks and into majors and asset managers offering access to money market funds. Money market funds which hold US Government Debt are considered the safest destination for large amounts of fund given the overwhelming uncertainty in the banking sector. They also have the added advantage of offering investors seniority in case of bankruptcy proceedings. Certain MMF’s are currently offering yields as high as 5.02% compared to a paltry 0.23% average for bank deposits, making the shift towards MMF’s a no-brainer for many. More than $300B has flown into money market funds in March taking the overall assets in money market funds to a record $5.1T. This also represents the largest month of inflows for asset managers since the start of the COVID-19 pandemic. Goldman, Fidelity, and JPM are the biggest beneficiaries from these inflows. Goldman’s US money market funds have increased by $52B or 13% since the beginning of the banking crisis on March 9th. JPM’s funds received $46B while Fidelity saw $37B of inflows according to data from iMoneyNet. Capital Flow into Gold Gold is one of the most prominent safe haven assets that investors look to in times of economic uncertainty and instability. This capital flow was seen during the 2008 financial crisis when bank deposits plummeted and Gold price skyrocketed. The same can now be seen on an even larger scale. Commercial bank deposits have plummeted well below even 2008 levels while the price of gold is teetering around $2,000/ounce, the highest price ever. Although, some gold investors choose to buy physical gold or jewellery, larger investors often opt for other instruments that are more cost effective such as ETF’s or Futures. This too offers the larger banks a huge opportunity to benefit from the inflow of capital into gold-linked products through their investment banking divisions. GLD, or SPDR gold trust is the largest Gold ETF. It saw a net inflow of $915M in March. The same can be seen in CME’s GC futures which saw managed money traders increase their net long positions by 5x or 83k contracts ~$16B. Trade Setup This case study illustrates potential gains to be harvested from spread trades as funds move from regional banks to majors. With rates remaining elevated the majors enjoy a comfortable Net Interest Margin. Rising deposit base by cherry picking high credit quality customers will enable banking majors to vastly outperform the regional banks. Therefore, this case study sets for three spread trades - (a) Long JPM and Short KBWR (1:3) (b) Long COF and Short KBWR (1:2) (c) Long C and Short KBWR (1:1) A spread trade requires that the notional values of each leg of the trade to be identical. Accordingly, the ratios above have been provided based on the closing prices as of April 3rd. Table below sets out entry, target, stop and reward-to-risk ratio for each of these trades. Long JP Morgan & Short KBWR ● Entry: 2.82 ● Target: 3.17 ● Stop: 2.62 ● Profit at Target: $16 ● Loss at Stop: $9.5 ● Reward-to-Risk Ratio: 1.7x Long Capital One Financial & Short KBWR ● Entry: 2.08 ● Target: 2.54 ● Stop: 1.9 ● Profit at Target: $21 ● Loss at Stop: $8.5 ● Reward-to-Risk Ratio: 2.5x Long Citibank & Short KBWR ● Entry: 1.01 ● Target: 1.19 ● Stop: 0.937 ● Profit at Target: $8 ● Loss at Stop: $3.5 ● Reward-to-Risk Ratio: 2.2x MARKET DATA CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com cme /. DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
NASDAQ:KBWBLong
by mintdotfinance
2
KRE Regionals still not out of the woods.Checking out a chart of KRE the regional banks have been the epicenter of the latest banking crisis. The FED has responded with BTFP to try and get ahead of the problem of mark to market losses on MBS and treasury holdings, but is it enough? I would have expected confidence in the sector to be somewhat restored and stock prices to have a relief rally. But prices have been stuck in a range as the broader market continues to climb. This is concerning for anyone who thinks this rally has more legs and something I'll be monitoring closely in the coming weeks.
AMEX:KRE
by The_Pain_Trade
Demonstration of the Wave principle in real life KRE If you want a demonstration of the Wave principle in real life look no longer than KRE. It is a textbook example of an impulse wave started on 23 March 20220. Wave almost 61.8% retracement of Wave 1 Extended 3rd wave with a 2.00 multiple of Wave 1 Wave 4 has almost 0.382 retracement of Wave 3. And the most important one: the entire impulse wave is divided perfectly into golden ratio. 0618/0382 This impulse wave finished on 19th January 2022. Since then the corrective phase has begun. We have 2 viable scenarios over here Scenario nr 1. An ABC zigzag We clearly have a minor impulse wave down finished in 5 waves that could be intermediate wave (A).-finished on 16th June 2022 Followed by a running flat ABC for wave B. notice the truncation of minor wave C of (B) warning us about the underlying selling pressure in KRE. And that's precisely what happened in wave (C). That is what an impulse wave 3 of (3) looks like. Fear response appropriate! The Fibonacci ratio for wave (B) is precisely 0.382 retracement of wave A . The most common one in a zigzag. Guideline of equality Waves (A) = Wave (C) at $42.65 normal in a zigzag. So with this interpretation probably one more minor wave down and everything will be roses in the regional banks. What is not normal in a zigzag is the slope of wave C should be less aggressive. So this brings me to an alternate count. Scenario nr 2 Because of the slope and severity of this late sale this makes it a wave 3. As I said before has all the marks of impulse wave 3 down in this case. So the whole correction becomes just waves 123 with waves 4 and 5 still to come to make just wave (A) of the decline. I will leave it up to you to decide which interpretation is most appropriate. Legal Disclaimer: The information presented in this analysis is solely for informational purposes and does not serve as financial advice.
AMEX:KRE
by WavesInvesting
1
PACW PacWest Bancorp Breaking Out With VolumeWhile Bank Regulators are trying to put together a package to save FRC First Republic Bank with JPM and Morgan Stanley, other hammered regional banks are looking like a bottom. PACW has a book value of 29.50 and a cash per share value of 17 dollars per share. FDIC Insured deposits account for 40 percent of total deposits, making a run less likely than FRC which has a 20 percent of depositors . These are compared to SVIB and SBNY which had a total of 3% and 6% insured by FDIC.
PLong
by loves2spooge
MTB | Oversold Regional Bank | LONGM&T Bank Corporation operates as a bank holding company for Manufacturers and Traders Trust Company and Wilmington Trust, National Association that offer retail and commercial banking products and services in the United States. The company's Business Banking segment offers deposit, lending, cash management, and other financial services to small businesses and professionals. Its Commercial Banking segment provides deposit products, commercial lending and leasing, letters of credit, and cash management services for middle-market and large commercial customers. The company's Commercial Real Estate segment originates, sells, and services commercial real estate loans; and offers deposit, and credit services. Its Discretionary Portfolio segment provides deposits, securities, residential real estate loans, and other assets; and short and long term borrowed funds, as well as foreign exchange services. The company's Residential Mortgage Banking segment offers residential real estate loans for consumers and sells those loans in the secondary market; and purchases servicing rights to loans, and sub-services residential real estate loans for others. Its Retail Banking segment offers demand, savings, and time accounts; consumer installment loans, automobile and recreational finance loans, home equity loans and lines of credit, and credit cards; mutual funds and annuities; and other services. The company also provides trust and wealth management; fiduciary and custodial; insurance agency; institutional brokerage and securities; and investment management and advisory services; financial management, and planning, leasing, and financing services. It offers its services through banking offices, business banking centers, telephone and internet banking, and automated teller machines. M&T Bank Corporation was founded in 1856 and is headquartered in Buffalo, New York.
NYSE:MTBLong
by DivergenceSeeker
2