Bank of America breaks support after policy shock

💡 DMK Insight

Bank of America’s sharp decline signals deeper issues in consumer credit dynamics. The recent gap below the lower trendline support indicates a loss of bullish momentum, particularly after Trump’s cap on credit card loans. This move could lead to increased volatility in financial stocks, as investors reassess credit risk and consumer spending. Traders should watch for further downside, especially if the stock fails to reclaim key levels. If the price continues to slide, it may trigger stop-loss orders, exacerbating the sell-off. Additionally, this situation could ripple through related sectors like consumer discretionary and fintech, as tighter credit conditions may dampen spending. On the flip side, if the stock finds support around previous lows, it could present a buying opportunity for contrarian traders. Keep an eye on the $30 level as a potential pivot point, and monitor broader market sentiment for signs of recovery or further deterioration.