Regions Financial Corp (RF)

Company

"Regions Financial Corporation, with $143 billion in assets, is a member of the S&P 100 Index and one of the nation's largest full-service providers of consumer and commercial banking, trust, securities brokerage, mortgage and insurance products and services. Regions serves customers in 16 states across the South, Midwest and Texas, and through its subsidiary, Regions Bank, operates 1,900 banking offices and approximately 2,300 ATMs. Its investment and securities brokerage trust and asset management division, Morgan Keegan & Company Inc., provides services from over 300 offices." (company website)

rf(3-1)
RF 4-month chart
rf(3-1)_1yr
RF 1-year chart

Buy

Regions has had a big run-up since mid-July, causing the 50-day moving average to turn up and near the 200-day moving average, which is still falling. The odd thing about this stock is that RF missed Expectations by a mile when they reported earnings in mid-July, but instead of tanking, it began rising. Obviously investors saw something else in the report besides the missed earnings.

  • Percentage price oscillator (PPO) — below the signal line, but closing the gap
  • Volume — heavily traded (40M+ shares/day), stable volume

Based on technical analysis, MarketEdge calls RF a "strong buy" in a "strong upward trend."

Sell

gain Bottom line
9%

My stop-loss order kicked in, and closed me out of this position.

With the 50-day average about to cross over the 200-day average, one might expect the price to go higher, and it may very well do so, especially since the jumps were on high volume after encouraging news that RF's bad-loan losses will be less than expected. Plus, the price is just at the previous peak, a natural resistance point.

What I think is likely to happen, however, is that there will be a consolidation period and/or a retracement to the lower Bollinger band before further advances.