The Bank of New York Mellon Corporation is a global financial services company. The company divides its businesses into two principal segments: Investment Management and Investment Services. It has another segment, which includes credit-related activities, the lease financing portfolio, corporate treasury activities (including its investment securities portfolio), its equity investments in Wing Hang Bank Limited and ConvergEx Group, business exits and corporate overhead. Its two banks are The Bank of New York Mellon, which houses its institutional businesses, including asset servicing, issuer services, treasury services, broker-dealer and advisor services.
To analyze New York Mellon’s stock for potential trading opportunities, please take a look at the 1-year chart of BK (The Bank of New York Mellon Corporation) below with my added notations:
I noticed BK because of its key level at $20. Not only can you see the $20 support (green) from January until present and from back in November, but the $20 resistance (red) was apparent back in the October and December periods of time. So, the $20 price is the current key level to this stock. If you are bearish, you might consider shorting BK on a break of $20, but if you are bullish, you would want to buy the stock at $20.
The Tale of the Tape: BK presents a couple of very simple trading opportunities based on its key level of $20. A short position could be entered IF the stock breaks below $20 with a stop set above that level, or a long play could be made on a pullback to $20 if that should happen.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT