Heyer Capital, LLC

investment management and timely advice from a local CPA (Fox Valley, Wisc.)

BKX (Big) Bank Index

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The BKX (Big Bank) Index is staggering around multi-year lows and, from a technical perspective, more importantly, have given three lower highs and four tests of support.    Each time a stock or index falls to a given price, it absorbs a layer of demand at that price. Think of what such a chart is showing you, as a true snapshot of supply and demand.    

I don’t want to remind you what happens when there is no demand at a certain price, particularly since the money center banks are such a crucial part of the capital markets.  Their falling equity prices clouds their ability to raise capital.  Income statements show the past, and balance sheets show the future. 

This might also be an abject lesson in trying to bottom fish and “buy stocks for the dividends.”  Caveat emptor.   

 

 

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Written by heyercapital

May 27, 2008 at 11:31 am

Posted in charting, stock ideas

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