The financials have stalled of late.  The run up in bonds(drop in yields) has cast a cloud over the sector.  Are they poised for a rebound?

Despite the extreme overhead pressure shares of MS are working on a third straight higher monthly low.  The stock left behind an ugly spike high after a steep post earnings(Jan. 17) drop.  MS has been consolidating in a narrow range since.

The $40.00 area has proven to a be a solid support zone(Feb/March lows).

A close above $43.20 would clear the initial March/February highs.  MS will have room run once this area is taken out.

We consider MS a low risk buy near current levels.  On the downside a close back below this week’s low($41.65) would indicate more sideways action is ahead before a fresh rally leg can take hold.

We are long MS in some managed accounts.