There's no describing the glee in the voices of professional
traders and professional market pundits alike on a day when the
financial stocks help lead the stock market out of an early morning
ditch of more than 100 points.
But before chasing some of these high-flying financials any
higher, take a look at those trading in
bull market territory
first and then have the patience to wait for pullbacks.
Many of these bank stocks are trading at significant new highs
for a second or third day in a row. Here are a few of the
potentially most rewarding to watch.
) rallied to another new 20-day high on Thursday, gaining more than
1% and finishing higher for a third day in a row. The buying has
conditions in the stock, and a "consider avoiding" rating of 3 out
The last time WFC was as overbought as it is ahead of trading on
Friday was in the first half of December. Then, a downgrade to 2
out of 10 set the stage for a drop in the stock that took Wells
Fargo lower by more than 5% in six days.
Also up more than 1% and earning short-term, "consider avoiding"
). Shares of USB have been trading above their 200-day moving
average on a consistent basis since late November, and are
overbought in the short-term ahead of trading on Friday.
With neutral ratings of 4 out of 10, USB could easily encourage
profit-taking over the next few days. Including Thursday's gains,
shares of USB are up more than 9% from their last 10-day closing
low in mid-December.
First Third Bancorp
) gained nearly 3% on Thursday and was among the best performing
stocks in its sector. This rally has brought with it, however, a
ratings downgrade to 3 out of 10, which puts the stock in the
"consider avoiding" category in the short-term. For traders looking
to buy stocks like FITB, shares are likely to be available at lower
levels, as those currently long the stock take advantage of recent
strength to sell their positions and lock in gains, potentially as
early as Friday.
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is Editor in Chief of TradingMarkets.com.