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Charles Schwab Corp (NYSE:SCHW) is tumbling alongside other major bank stocks, as economic uncertainty and persistent selling pressure weigh on the financial sector. With Wall Street on edge over tariff negotiations and recession concerns, traders are keeping a close eye on bank stocks for potential value opportunities amid the volatility.
On the charts, Charles Schwab stock has erased its 11.8% January gain and is now down 4.1% year-to-date, on track for its 11th loss in 13 sessions. Last seen 4.9% lower at $70.95, the stock is within striking distance of its 260-day moving average, a historically bullish level.
According to Schaeffer's Senior Quantitative Analyst Rocky White, SCHW tested this trendline five times in the past three years, and each time, the stock was higher one month later with an average 8.4% gain. A similar rebound from current levels would place the equity just below $77, approaching its Feb. 11, 13-month high of $84.50.
An unwinding of bearish sentiment in the options pits could provide additional tailwinds. Charles Schwab stock’s 50-day put/call volume ratio of 1.39 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 90th percentile of the past year, signaling an extreme preference for puts.
Additionally, SCHW’s Schaeffer's Volatility Scorecard (SVS) of 91 out of 100 suggests the stock tends to outperform volatility expectations, making it an appealing setup for premium buyers.