• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Economy Bank of America: Cash Allocations Drop to 3.9%
Economy

Bank of America: Cash Allocations Drop to 3.9%

by October 18, 2024
by October 18, 2024 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

BoA Warning: Low Cash Levels Signal Market Risk

A recent Bank of America fund manager survey revealed that fund managers have lowered their cash allocations to 3.9%, the lowest since February 2021. This percentage continues to decline further below the 4% threshold, which often signals investors to sell the market. A bank employing this method states that when cash allocations drop to this level, it indicates that investors are buying lots of equities with little cash; otherwise, the market gives a contrarian signal, which has usually led to worse market returns in the past.

Data from previous signals reveals that global stocks generally have a drop of 2.5% in one month and 0.8% in three months after these warnings. Bank of America’s strategist Michael Hartnett said that such signals usually emerge when investor optimism surges, aligning with current trends as stocks trade near record highs.

Investors have clearly shown more optimism and trust, prompted by the possibility of the Federal Reserve cutting its interest rate on Chinese economic stimulus, as well as hopes of a smooth economic landing. The survey detected a massive leap in worldwide growth prospects, from -47% to -10%, which is one of the five most tremendous changes recorded since 1994.

Most institutional investors expect to witness a soft landing with a probability of 76%. Soft landing is a term indicating that the economy will move slowly without any negative sharp movements down, which typically would happen if it involved a hard landing of the economy. In the so-called investor sentiment up, the dwindling spot at the highs of the market can be a catalyst for the fast market retreats. This is because the markets stand on solid foundations for long-term growth.

Bank of America Chart Analysis

BOA/USD 15 Minute Chart

Observing the recent chart specified for Bank of America (NYSE: BAC), it is clear that there has been a lot of volatility in the market over the last five days. On October 11, the stock unexpectedly jumped from just over $40 to more than $42 in a single day. Following that significant spike, the price of the stock has been in a tight trading range of “$42.50” and “$43“, with investors remaining cautious as they evaluate the prospects.

We observed that the stock peaked at $43.36 during the establishment of the consolidation decided but failed to sustain it, thus encountering resistance first. After the drawdown, the stock has been moving from $42.80 to $42.79, indicating that the market is not sure which side to bet on. The reduction of only 0.19% in the last session ensures that the investors are, so far, not affected too much. Maybe they are still sure about the decision once they get more updates.

The initial increase in the value of the company’s stock may be the result of a renewed belief in Bank of America. This could be to do with the great financial results of the bank or the positive outlook connected to the entire banking sector. Nevertheless, the stock’s inability to surpass the $43.36 resistance level may mean the end of the upward trend.

At this stage, we are closely monitoring to see if the stock is able to get beyond resistance or if it will drop down to test support levels around $42. Meanwhile, the sideways movement might display decisions made by traders and investors.

If you are paying close attention to Bank of America’s stock, you should at this time think about what to do next. Be prepared to take any direction given next!

The post Bank of America: Cash Allocations Drop to 3.9% appeared first on FinanceBrokerage.

You Might Also Like
  • Durable-Goods Orders Declined in November
  • New Hampshire House passes bill to replace embattled youth detention center
  • US must expand nuclear arsenal in face of Russia and China threat, warns top Obama defense adviser
  • House committee sets up vote to expand Section 702 of FISA for 2 years
Share
0
FacebookTwitterPinterestWhatsapp

previous post
Trees Corporation (CANN) Stock Price Analysis and Forecast
next post
Interactive Brokers Expands Crypto Services in 2024

You may also like

Dem AZ Senate candidate voted to protect friend and donor’s...

May 10, 2023

AUDUSD and AUDNZD: AUDUSD is making new high this morning

September 16, 2024

Republican says Biden has ‘strengthened’ Hamas by withholding aid from...

May 13, 2024

Pence laments pro-life principles ‘fell short’ at RNC, thanks delegates...

July 23, 2024

Haley spotlights Trump ‘chaos’ as judge sets former president’s hush...

February 16, 2024

Comer demands White House provide records to prove $200K payment...

October 27, 2023

We asked Vivek Ramaswamy why polls show many Americans think...

September 18, 2023

RFK Jr unleashes on Biden, Dems after accusing them of...

May 31, 2024

Bitcoin and Ethereum: Bitcoin is close to a weekly high

October 18, 2024

AG Garland pledges to fight voter ID laws, election integrity...

March 4, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Want Faster, Lower Risk Trades? Use This Setup

      July 9, 2025
    • The Seasonality Trend Driving XLK and XLI to New Highs

      July 9, 2025
    • Small Caps Are Rotating In — Here’s Why It Matters

      July 9, 2025
    • Amazon extends Prime Day discounts to 4 days as retailers weigh tariffs and price increases

      July 9, 2025
    • Breakout Watch: One Stock in Each Sector to Watch Now

      July 9, 2025

    Popular Posts

    • 1

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 3,630 views
    • 2

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,919 views
    • 3

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,607 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,576 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,449 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,167)
    • Investing (538)
    • Stock (2,660)

    Popular Posts

    • 1

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 2

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 3

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • Want Faster, Lower Risk Trades? Use This Setup

      July 9, 2025
    • The Seasonality Trend Driving XLK and XLI to New Highs

      July 9, 2025
    • Small Caps Are Rotating In — Here’s Why It Matters

      July 9, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,167)
    • Investing (538)
    • Stock (2,660)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    Harris claims she ‘made clear’ her...

    August 30, 2024

    Mayorkas claims border encounters have dropped...

    January 19, 2023

    Pence warns renewed Iran deal would...

    March 12, 2023
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here