Marc Chaikin's  Instablog

This morning $UBS recommended the major banks. The Chaikin Power Gauge turned bullish on most of these banks in mid-December.

After a 3 month move to the upside the major banks are overextended. Don't chase them here but rather buy them on pullbacks.

Stocks with a bullish Chaikin Power Gauge Rating which also have strong technical patterns and bullish Chaikin Money Flow include:

Bank of America - $BAC

Citigroup - $C

JP Morgan Chase - $JPM

U.S. Bancorp - $USB

Wells Fargo - $WFC

All of these stocks are overbought. However, given the depths of the declines which preceded the lows, in the October - December 2011 time frame, they may not pullback enough to satisfy those on the sidelines who did not participate in this extraordinary upward move.

Use pullbacks of 5- 10% over 3 - 7 trading days to establish positions or add to existing holdings in the major bank stocks with bullish Chaikin Power Gauge Ratings.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.