The Elliott Wave forecast for Bank of America (BAC) shows an upward trend after a rally from a low point on October 10, 2025. The stock is moving in an impulse pattern, suggesting a positive outlook for future price increases. Members are encouraged to buy during pullbacks at certain levels, known as blue box areas.

A chart from December 18, 2025, indicates that a cycle concluded at $56.07, leading to a pullback that formed a double three structure. This pullback ended when the price reached the blue box area between $54.17 and $53.31. After this, we saw a predicted increase due to buyer activity.

BAC Reaches Target Zone

According to a recent chart from December 23, 2025, BAC’s price climbed after correcting and reached the target zone of $59.16 to $60.43. This allowed members to enter the market without risk by buying at the suggested blue box area. Following this, BAC hit new highs, prompting expectations of profit-taking and another pullback. This pattern supports the expected growth for BAC. The recent price action in Bank of America shows that the bounce from the $54 level is a clear buying signal. The stock shows a solid reaction from an important support zone, indicating that the upward trend that began in October 2025 is continuing. Traders should prepare for a movement towards the $59 to $60 range in the weeks ahead. To take advantage of this expected increase, consider buying call options expiring in January or February 2026. Strike prices of $58 or $59 align with the projected targets while managing our risk as we enter the new year. A bull call spread might also be a smart approach to reduce entry costs during the holiday trading period.

Financial Sector Support

This optimistic view of the financial sector is backed by the current economic climate. In November 2025, the Federal Reserve cut the benchmark rate to 4.25%, signaling a more supportive policy that usually benefits bank lending margins. This shift has generated positive feelings throughout the sector. The Financial Select Sector SPDR Fund (XLF) has outperformed the S&P 500 by more than 4% over the past month, indicating strong performance in financials. This surge follows a successful third-quarter earnings season for major banks in 2025, with many, including Bank of America, reporting higher-than-expected net interest income. This bolsters the positive technical view we are seeing. For those preferring a more cautious strategy, selling out-of-the-money puts can be effective. With strong support at the $54 level, selling January 2026 puts with strike prices of $54 or $53.50 allows us to earn premium while positioning ourselves bullishly at a better price if the stock dips again. The CBOE Volatility Index (VIX) has stabilized around 17, which, although not high, offers enough premium to make such trades beneficial. However, we should stay alert to mixed signals in the broader market. While stocks show strength, gold is nearing record highs of $4,500, and cryptocurrencies are weak, indicating some underlying caution. Therefore, we must carefully manage our bullish positions in BAC and have clear exit strategies in place. Create your live VT Markets account and start trading now.

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