Shares of Bank of America Corporation are overbought and at resistance, which means it may be time to sell.
Resistance is a large concentration of sellers gathered around the same price. At resistance levels, there is more supply than demand for shares. Stocks tend to head lower after running into them.
That’s what happened to Bank of America’s stock when it hit resistance around $50 in early January.
The shares are also overbought, which means they’re trading at an extreme above their typical trading range. These conditions could attract sellers into the market. They will be expecting a reversal.
These two dynamics of being overbought while at resistance means there’s a chance the Bank of American rally is over.
By Mark Putrino
© 2021 The Epoch Times. The Epoch Times does not provide investment advice. All rights reserved.
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