Financials are the second-best performing sector in 2021. Now one of the biggest names has pulled back to hold some key levels: Morgan Stanley.
MS dipped on the Archegos implosion last week, but reportedly faces no significant losses.
That brought MS down to its 50-day simple moving average (SMA). It tested below that line on March 29 but has managed to close above it each day.
Second, the current level around $77 is important because it was not only a high in mid-January. It was also the investment bank’s former peak from June 2007 -- before the subprime meltdown.
Third, stochastics are oversold. The last time this happened in late January was followed by a breakout to new highs. It also anticipated the move in late October.
Finally, MS is the type of cyclical value stock that investors have recently favored as the economy recovers. Given last week’s strong non-farm payrolls and ISM manufacturing reports, there’s no reason to think that trend is finished yet.
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MS dipped on the Archegos implosion last week, but reportedly faces no significant losses.
That brought MS down to its 50-day simple moving average (SMA). It tested below that line on March 29 but has managed to close above it each day.
Second, the current level around $77 is important because it was not only a high in mid-January. It was also the investment bank’s former peak from June 2007 -- before the subprime meltdown.
Third, stochastics are oversold. The last time this happened in late January was followed by a breakout to new highs. It also anticipated the move in late October.
Finally, MS is the type of cyclical value stock that investors have recently favored as the economy recovers. Given last week’s strong non-farm payrolls and ISM manufacturing reports, there’s no reason to think that trend is finished yet.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
