Health of Banking Sector Important to Stock Market
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Although the bull market has grinding higher, it’s awaiting confirmation from the banks and banks stocks.
Today’s chart is of the S&P 500 Bank ETF (NYSEARCA:KBE) and shows how the banks are at an important juncture in time and price.
KBE (the bank ETF) is testing the upper end of a falling channel, offering bulls an opportunity for a breakout – see point (2).
The banks were at a similar juncture nearly 3 years ago at point (1), before breaking out and leading the bull market higher.
KBE would send a bullish message to the market if it breaks out at point (2). Stay tuned!