False Breakdown in Bank of America?Bank of America lost more than 40 percent of its value between February's high and this morning’s low. Is the megabank now showing signs of a bounce?
The first pattern on today’s chart is the early drop to $29.31. That was BAC’s lowest price since December 2020, but it lasted less than 30 minutes. Prices turned green by 10am ET and quickly surpassed the previous session’s high.
The result was a few possible reversal patterns. First is today’s bullish outside candle.
Second, you have a false breakdown to new 52-week lows.
Third is the potential double-bottom at the July lows. That’s especially visible on the weekly chart, which also shows BAC holding support from early 2021.
The next pattern to watch could be the falling trendline along the highs of September 20 and October 4. This, combined with the support level from February 2021 of $29.57, create a narrowing range. Traders may look for a potential breakout, especially with quarterly results due the morning of Monday, October 17:
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