Today's early low in Bank of America (BAC) at 11.08 held above last week's low at 11.05, which held above the October 26 low at 11.03. Today's subsequent rally to 11.25/30 has carved out a minor base-like pattern since November 22, which must hurdle and sustain above 11.33/40 to trigger initial buy signals that will project into the 11.75/80 area initially.

The developing minor base pattern is attached to a much larger potential base pattern that spans the mid-October to mid-November time frame. If the minor base triggers upside projections, then the larger base will become much more of a technical force in the market, and will point BAC towards a test of its October-November down trendline, now at 12.10.

If hurdled, this should trigger a run at the 11/09 recovery rally high of 12.76. At this juncture, only a decline that violates the series of lows near 11.00 will disrupt the basing pattern.

 

Mike Paulenoff is a 26-year veteran of the financial markets and author of MPTrader.com.