Bank of America (BAC – NYSE) is desperately trying to fight off rising labor costs in the face of lackluster growth.
The Wall Street Journal has revealed BAC plans to cut some 400 white-collar jobs in their investment banking, corporate banking, and sales units.
Now connect the rest of the dots: BAC’s wealth-management operations in Asia, Latin America, and Europe are up for sale. This sale will eliminate up to 2,000 jobs. And last spring, BAC announced a cost-cutting program aimed at eliminating some 30,000 consumer banking and technology jobs.
Eventually, these savings may help BAC’s bottom line. But right now, traders just don’t see these firings as the hallmark of a company on the upswing.
When we look to BAC’s weekly chart, we see a 70% complete Sell Signal Stack:
- Price has reversed at the top of trend,
- Accumulation has given way to distribution,
- And MACD has almost completed a Sellers Cross.
Trading Tip: The best BAC can hope for right now is a bounce off support at $6.94 (-14.53%). If that level doesn’t hold, that loss will double in short order.