Ahead of the Fed meeting Wednesday the market was pretty much 50/50 split on whether the fed funds rate would be cut by 25 or 50 basis points. After the 50bps announcement the counter intuitive move occurred, which was rates began rising, but this should have been a surprise. This was as straight forward "buy the rumor, sell the news" gets. Today however it...
As usual the move in financials has been over done, thank you very much Ms. Yellen & Co.
I believe we are presented with a near term pullback. While I'm showing some support around 88, I wouldn't wait that long to take profits. Would be more inclined to pull the trigger around $90.50.
Don't get me wrong, I'm super long the financials and have been since $BAC was at $7, but it seems these guys always over react to news (or perhaps no news at all), and then correct. Look for $BAC (along with many other fin stocks) to pull back in the coming days. Near term target of $23.
Fundamentals are horrible. Company has thrived on low interest rates as they've been able to borrow to cover short term payables. Negative equity is on its way by next quarter.
