Is Bank Index Teetering Near Financial Crisis Highs?

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BKX Weekly Chart.

Buyers perceive the significance of banks to the financial system and the broader market.

And since bottoming with the coronavirus crash, the has greater than doubled.

However, this 12 months has seen the financial institution index sluggish its roll – see level (1) on the BKX “weekly” chart above.

As you’ll be able to see, the index made a excessive earlier this 12 months and hasn’t been in a position to exceed that prime. This divergence is a bit regarding when including historic context.

Now, in fact, this index might proceed to rally and make new highs (and none of this might matter). But when it doesn’t, then we have now an issue.

As you’ll be able to see, in 2007 a decrease excessive netted a 90% decline. And previously 4 years, we have now had two decrease highs that produced declines of 30% and 50%.

What Would Make This Chart Tremendous Bullish?

If the index breaks above the highs of some months in the past and the monetary disaster highs, banks would ship a brilliant bullish message to the broad markets.

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