Money is rotating towards financial stocks as the market prepares for what appears will be Fed tightening later in 2015 into 2016. Higher yields on treasuries and a steepening yield curve generally increase net interest margin, the key metric in bank earnings. So traders are using this fundamental development to encourage buying in many areas of the financial sector and bullish technical signs are popping up everywhere in this space, especially banks. PNC Financial Services (PNC) is just one company in this area that broke out last week, clearing cup resistance. The breakout near 96.00 initially measures another 5 points higher (depth of cup) to the 101.00 level. Keep an eye on PNC and the rest of the banking stocks as the threat of higher interest rates should bode quite bullishly for this group. Check out PNC:
Happy trading!
Tom
