Before we get started, we would like to provide an update on a couple of existing ideas:
We recommend closing out Vishay Intertechnology (VSH), because it has logged two consecutive daily closes below our stop-loss level.
Following its short-term breakout, we are tightening our stop-loss level in FTI Consulting (FCN) to $172 from $160.
With bank stocks looking well-positioned in relative terms going into earnings, we revisit the space with an appealing setup in First BanCorp. (FBP):
FBP looks poised to clear its 50-day and 200-day MAs in a bullish short-term catalyst. Positive short-term momentum, as evidenced by the daily MACD and the upturn in the weekly stochastics, supports a move up toward YTD highs.
The short-term constructive price action comes within a bullish long-term context, noting FBP maintained its long-term uptrend after a positive reaction to oversold indications from DeMARK Indicators® near long-term support at the weekly cloud model (shaded area on the chart).
Long-term resistance near $16.60 can be used as an upside target, albeit perhaps ambitious for this bear market cycle, and we recommend using the bottom of last’s week gap, near $14.20, as a stop-loss level.
First BanCorp. (FBP, $14.78)
Target: $16.60
Stop-Loss: $14.20