Take This Six-Pack to the Bank
This column was originally published on RealMoney on March 21 at 12:30 p.m. EST. It's being republished as a bonus for TheStreet.com readers.
Bank stocks have been running in place since the Philadelphia Banking Sector Index (BKX) broke above multiyear resistance in February.
Now, despite the mediocre performance, it appears this important group will move substantially higher in the months ahead.
You can take advantage of this embryonic rally by trading the strongest stocks and best-looking patterns in the sector. But keep in mind these two attributes are often in conflict.Quite often, top-ranking stocks have risen so far they look overextended and dangerous to buy. So it's best to focus your efforts on banking stocks that have slipped under the radar, with run-of-the-mill strength rankings and poorly defined uptrends. A handful of these quiet issues will show pattern characteristics predicting they'll eventually become sector leaders. Let's look at six of these emerging opportunities. SVB Financial Group (SIVB) rallied to a five-year high at $52.33 last July and pulled back in a deep correction. It found support in the mid-$40s and ground sideways for more than four months before rallying back to the high last week. This should set the stage for a major uptrend.
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