Shares of Bank of America (BAC) continue to collapse lower after the Federal Reserve lowered interest rates to near zero. The banks will have to continue to diversify their portfolio in order to make money. The good news is, these big banks are at no risk (right now) of going out of business. The question is, where is the Bank of America institutional buy level?
Based on talking to various fund managers that are sitting with cash on the sidelines and analyzing the stock charts closely, it appears there is an epic level at $18.00. The low of today was $19.73. This means the Bank of America institutional buy level is not far away. This $18 level would also be an approximate 61.80% Fibonacci retrace from the 2009 lows (the financial collapse) as well as a 50% drop from the recent highs.
Investors should be eyeing this level as a major accumulation zone on Bank of America. It is likely that investors will dream about these levels in a year, wishing they had another chance to buy. Most investors are too fearful to buy when panic is hitting, but common sense will hopefully prevail.
Source: Trade Stocks