Another jump in yields has sparked a sharp rally in banks. The $BKX(KBW Bank Sector Index) is up 2.5% in today’s early going. State Street Corp is one of a number of big gainers in the sector. Shares are up just shy of 4% as the March rally extends to 10%. This morning the stock is piercing a key overhead trendline(links previous two monthly highs) as it heads for 2021’s best close.
STT has been trading in a fairly narrow range since the Nov. 9 vaccine ramp. A close above $81.00 would take out the top band of this consolidation.
STT is far from overbought despite trading near multi year highs. Daily MACD has been trending near neutral since early February.
We believe STT is set up well for a retest of the 2020 high($86). On the downside, a close back below this week’s low($74) would indicate more range bound action is ahead.
We are long STT in some managed accounts.