BAC - bullish with higher rates

Bank of America (BAC) - the shining star of the US financials, ended the month on a fractionally positive note, settling +1cent to $28.17. This made for a third consecutive net monthly gain of 3.3%. M/t outlook is bullish, with soft target of the $33s, and secondary of the 40/45 zone within 12/18 months. Higher rates are bullish for BAC, the financial sector, and the broader US equity market.


BAC monthly

BAC daily

Summary

It was a bullish end to the month, and there is zero reason to expect the m/t trend not to continue until at least the $33s, if not $40/45. The latter will clearly require US rates at least 2.50%, if not >3.00%.

For the record, I do NOT expect rates to fully 'normalise' to around 5%. There are simple 'math problems', as higher rates will eventually cause problems in terms of debt repayments, at consumer, corporate, and governmental level. However, until rates are at least 2.50%, I don't see any significant reason to be concerned.

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Many in the mainstream recognise that higher rates are bullish for BAC and the broader financial sector...

Pete Najarian of investitute.com, regularly highlighting BAC, JPM, XLF

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yours.. bullish BAC, the financials, and the main market, into/across 2018.