Since reaching fresh December highs back on Dec. 15, Bank of America (BAC) - Get Report has looked rather heavy. The stock has been trading in a narrow range over the last week and a half just below what is now developing into a heavy resistance zone near the multi-week December highs. BAC is still rangebound but a drop below $22.20 could open up the stock for a deep pullback.

Since the Nov. 8 presidential election, Bank of America has had a monumental run. At last week's high the stock had gained over 40%, a surge that drove shares the furthest above the stock's 40-week moving average since 1998.

The consolidation the stock has been tracing out over the last three weeks is healthy, but may not hold considering the overbought readings. A downside resolution would relieve much of this pressure while providing patient investors with a much lower risk-entry opportunity.

In the near term Bank of America bulls should keep a close eye on the $22.20 area. A clear take out of this level would indicate a pullback is underway. Once below this level a drop down to initial support near the November peak ($21.20) is likely. If shares can regain their footing here, a fresh rally leg could develop.

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Long BAC