Chris Verrone Shares His Opinion On Interest Rates And Banks

Chris Verrone Of Strategas Research Partners spoke about the most important trends in the market on CNBC's Fast Money

He said that the trend for interest rates is changing. He explained that the 10-Year yield has jumped above its trend line and it recently bounced off its 50-day moving average and made a new high. Verrone added that short interest in iShares Barclays 20+ Yr Treas.Bond (ETF) TLT is too low, which, in his opinion, means that the sentiment is too complacent. He believes that investors are ready for higher interest rates.

Related Link: Fast Money Traders Share Their Banking Sector Picks Ahead Of Earnings

In an environment of higher interest rates, Verrone wants to own KBW Nasdaq Bank Index BKX, which broke above its trend line and it recorded a couple of higher lows. He explained that there are more banking stocks above its 200-day moving average than at any time over the last 14 months.

JPMorgan Chase & Co. JPM, SunTrust Banks, Inc. STI, KeyCorp KEY and Fifth Third Bancorp FITB also look good to him.