Regional Banks Make a Comeback: Is There More Room to Run?
Regional Banks (KRE) made a comeback during the session.
The price pierced the 44 resistance level and closed above the last 18 trading day’s range.
On March 6, over a month ago, I wrote a piece.
At the time, KRE was trading at $60, predating the short-lived banking crisis, but not by much.
That began happening on March 7.
With lots of bank earnings out of the way and a rally in KRE, the Fed could have bad timing once again.
On April 12, according to Fed documents, “fallout from the US banking crisis is likely to tilt the economy into recession later this year.”
But maybe, with KRE holding, that potential bottoming pattern emerging and the indexes rallying.
That feels great for now but comes back to bite later. For now, let’s focus on the chart.
KRE Daily Chart
According to our Real Motion, Momentum says sideways with a slight uptick.
Plus, the red dots or momentum tracker is way closer to the overhead moving averages than the price is to its MAs.
Momentum must continue to improve. Should that clear the MAs, we would expect KRE’s price to increase closer to 50.
That most likely will mean the SPDR® S&P 500 (NYSE:SPY) runs over the 420 level.
The 23-month moving average shows potential business cycle expansion, and everyone jumps back in the pool.
Projecting ahead-KRE has a long way to go to recover from the huge crash from March 6 and 13.
However, this is a catch while you can market. So, for now, our Prodigal Son caught another break.
- S&P 500 (SPY) Tight range to watch this week 412-415
- Russell 2000 (IWM) 170 support- 180 resistance
- Dow (DIA) Over the 23-month MA 336-impressive if holds
- Nasdaq (QQQ) 312 support over 320 better
- Regional Banks (KRE) 44 is now pivotal
- Semiconductors (SMH) 258 resistance with support at 248
- Transportation (IYT) Timely
- Biotechnology (IBB) 130 major pivotal area-135 resistance
- Retail (XRT) 58- 64 trading range to break one way or another