Check out how BAC's recovered above $40 from $35 within few days.
The is a technical indicator of the crazy volatility which confirms that BAC is a strong value play trading temporarily at huge discount.
Mr Market is clearly not efficient as a weighing machine however it is a near-perfect short-term discounting machine. Here we see the shorters who timed the US govt and Fed interventions quickly covering up their positions in order not to get caught out knowing that BAC is poised to return back to fair value.
This stock will be back at $50 by end of the year. That's a nice 25% gain from current level plus 6% from the dividend. Total gain = 31%
Buy this stock now if it double-tests support again between $35 - $37. It won't trade this low for too long.
Note: The value investor should not use technical analysis without sound understanding of fundamental analysis
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment