BAC Rally Losing Momentum

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Shares in Bank of America are trading a little lower pre-market on Tuesday.

Following the recent rally from the September-November lows around the 23.00 level up to highs of 29.36, BAC shares have since retraced to 28.22 pre-market today.

BAC shares have broadly benefitted from the uptick in risk appetite over recent weeks. That said, the move has lost a little momentum after testing the highs posted in June.

New Payment System

BAC has been in the news this week with the bank announcing a new, cross-border payment system.

The Cash-Pro self-service tool is a SWIFT gpi module accessible through BAC’s proprietary, integrated platform. It combines a range of cross-border payment information on the SWIFT network.

Better Info for Clients

Commenting on the new system, Tom Durkin, BAC’s Global Product Head for CashPro Global Transaction Services said:

“Our payments tracking tool populates SWIFT gpi information into a view that can be read easily and acted upon immediately.”

Expectations are for the new system to be a big draw for clients, offering a range of benefits including:

– better visibility in lifting fees and payment charges, including FX fees
– better payment settlement transparency, including data on timing, amounts, and counterparty identity
– reduction in time taken to investigate/resolve issues.

Better Global Coverage

As part of the new system, BAC clients will be able to investigate the reasons why a transaction was rejected or canceled.

The new system comes at the same time as the bank expands its SWIFT gpi international coverage to cover more than 140 currencies.

David Kretz, Head of Global Strategy and Payments for global Transaction Services explained:

“Incorporating SWIFT gpi data across all relevant customer channels supports our goal of working with the broader transaction services industry to remove friction and bring transparency to cross-border payments.”

Mixed Q3 Earnings

The bank recently reported a mixed set of Q3 earnings with earnings per share of $0.51. This mildly beat estimates for a $0.49 EPS.

However, headline revenues underperformed at $20.45 billion over the quarter. This undershot the estimated $20.8 billion Wall Street was looking for.

BAC Capped At Summer Highs

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Shares in BAC have been capped at a test of the 29.08 June highs for now.

However, following the breakout above the bearish trend line from year to date highs, the short term view remains bullish while shares hold above 27.69.

Below here, the next support to watch is down into the 26.21 level. To the topside, a break above the 29.08 level will turn focus to the 31.01 resistance next.

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