Bank of America (BAC) Offering Possible 12.61% Return Over the Next 20 Calendar Days

Bank of America's most recent trend suggests a bearish bias. One trading opportunity on Bank of America is a Bear Call Spread using a strike $25.50 short call and a strike $30.50 long call offers a potential 12.61% return on risk over the next 20 calendar days. Maximum profit would be generated if the Bear Call Spread were to expire worthless, which would occur if the stock were below $25.50 by expiration. The full premium credit of $0.56 would be kept by the premium seller. The risk of $4.44 would be incurred if the stock rose above the $30.50 long call strike price.

The 5-day moving average is moving down which suggests that the short-term momentum for Bank of America is bearish and the probability of a decline in share price is higher if the stock starts trending.

The 20-day moving average is moving down which suggests that the medium-term momentum for Bank of America is bearish.

The RSI indicator is at 34.08 level which suggests that the stock is neither overbought nor oversold at this time.

To learn how to execute such a strategy while accounting for risk and reward in the context of smart portfolio management, and see how to trade live with a successful professional trader, view more here


LATEST NEWS for Bank of America

Banks Get Easier Volcker Rule and $40 Billion Break on Swaps
Thu, 25 Jun 2020 20:56:30 +0000
(Bloomberg) — Wall Street banks will soon be able to boost investments in venture capital funds and pocket billions of dollars they’ve had to set aside to backstop derivatives trades as U.S. regulators continue their push to roll back post-crisis constraints.The Federal Reserve, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. approved changes to the Volcker Rule Thursday that let banks increase their dealings with certain funds by providing more clarity on what’s allowed. The regulators also scrapped a requirement that lenders hold margin when trading derivatives with their affiliates.Read More: Wall Street’s Win Streak With Trump Regulators Dangles by ThreadThe revisions will complete what watchdogs appointed by President Donald Trump have referred to as Volcker 2.0 — a softening of one of the most controversial regulations included in the 2010 Dodd-Frank Act. Last year, the Fed, FDIC, OCC and other agencies eased the better-known aspect of Volcker that restricts lenders from engaging in proprietary trading — the practice of making market bets for themselves instead of on behalf of clients.Thursday’s separate reversal of the interaffiliate margin requirement for swaps trades could free up an estimated $40 billion for Wall Street banks, though regulators added a new threshold that limits the scale of margin that can be forgiven.The KBW Bank Index rose 3.4% Thursday, with Bank of America Corp. and JPMorgan Chase & Co. among the gainers.Key DetailsVolcker 2.0 allows banks to take stakes in venture-capital funds that were previously banned in an effort to provide “greater flexibility in sponsoring funds that provide loans to companies.” The change is mostly similar to what regulators proposed last year.The Volcker Rule changes were also approved by the Securities and Exchange Commission and Commodity Futures Trading Commission.The FDIC board passed the new rule in a 3-1 vote, with Chairman Jelena McWilliams saying the changes “should improve both compliance and supervision.” Democratic board member Martin Gruenberg opposed the move, saying it leaves Volcker “severely weakened” and “risks repeating the mistakes” of the 2008 financial crisis.Volcker 2.0 didn’t include all of the industry’s demands for relief. In a March comment letter, Goldman Sachs Group Inc. had urged regulators to eliminate certain Volcker interpretations that have “restricted our ability to invest in certain incubator companies that provide capital and ‘know-how’ to startup companies and entrepreneurs.” The agencies didn’t act on that request.In scrapping the requirement that banks post margin for trades between affiliates, regulators did add a new threshold to prevent banks from abusing the relief: If a firm operating under the old rule would have had to set aside initial margin exceeding more than 15% of its so-called “Tier 1” capital, then it still has to set aside margin that surpasses that amount. The demand, which is meant to boost the safety and soundness of the new approach, will force banks to continue calculating on a daily basis what their margin requirements would have been under the rule that’s been eliminated.The industry and regulators argued that requiring margin for interaffiliate transactions made it difficult banks to manage their risks. But critics say forcing banks to maintain an extra cushion against losses helped protect subsidiaries that are backed by the federal government, including through deposit insurance.The FDIC’s Gruenberg opposed the change to swaps rules, arguing that it removes a critical protection for banks. Fed Governor Lael Brainard reiterated that concern, saying in a statement that she dissented from the Fed’s approval because she fears the deregulatory move “could again leave banks exposed to the buildup of risky derivatives.”Read MoreWall Street’s Win Streak With Trump Regulators Dangles by ThreadTrump Regulators Hand Wall Street Banks a Big Win on Swaps Rule(Updates with index price in fifth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Bank Regulators Ease Up on the Volcker Rule. Next Up Are the Stress-Test Results.
Thu, 25 Jun 2020 18:21:00 +0000
The move will let banks invest more easily in venture-capital funds, as well as allowing lenders to reduce margin requirements for derivatives trades.

MOVES-Citi hires Wells Fargo's Titi Cole to run consumer bank operations
Thu, 25 Jun 2020 16:30:00 +0000
Citigroup Inc said on Thursday that it has hired Wells Fargo & Co's Titi Cole to run global operations and fraud prevention for its consumer bank. Cole was most recently executive vice president and head of operations at Wells Fargo, where she oversaw functions that helped keep most of the bank's business lines running smoothly. “Titi is a skilled people leader with a track record of developing and leading high performing teams,” Jane Fraser, president of Citi and CEO of the Global Consumer Bank, said in an internal memo seen by Reuters.

Day Ahead: Three Things to Watch for June 26
Thu, 25 Jun 2020 15:34:11 +0000
By Christiana Sciaudone

Dow Off Lows, Led by Financials as Regulators Set to Cut Banks a Break
Thu, 25 Jun 2020 13:01:11 +0000
By Yasin Ebrahim

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