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More Reading from MarketBeat Media Regional Banking Sector Near a Critical Inflection PointAuthored by Ryan Hasson. Originally Published: 1/14/2026. 
Key Takeaways - Regional banks are nearing a significant level, with the KRE ETF consolidating just below resistance at $70, setting up a potential breakout or double top scenario.
- A confirmed breakout in KRE could benefit not only regional banks but also small-caps more broadly, given the heavy financials weighting in the Russell 2000.
- Huntington Bancshares offers leverage to the theme, combining a bullish technical setup near long-term resistance with an attractive dividend and upside potential based on analyst targets.
Technology stocks continue to dominate headlines. Artificial intelligence has powered much of the S&P 500's gains, and newer themes such as agentic AI, drones and defense, and precious metals are attracting investor attention early in the year. But markets often rotate leadership quietly. While the spotlight remains on high-growth sectors, one group is approaching a technically significant inflection point that could have broader implications for market direction. That sector is regional banking. Regional Banking Sector Near a Critical Inflection Point The former CEO of Google calls it the most important thing to happen in 500, maybe 1,000 years of human society. A former U.S. Treasury Secretary says when your great-grandchildren write the history of this period, the political headlines will be the second or third story. The first story is something none of us have seen before. The dot-com collapse, global financial crisis, and COVID-19 pandemic don't compare to what's coming next. We may be entering a period of dramatic, almost unimaginable change. See the full warning and how to prepare now. The SPDR S&P Regional Banking ETF (NYSEARCA: KRE), which tracks the regional banking sector, is consolidating just below a multi-year resistance zone near $70. From a longer-term technical perspective, this area represents a pivotal battleground. The setup raises a familiar question for technicians and investors alike: is the ETF forming a double top, or is it building a base for a breakout that could mark the start of a new uptrend? It's too early to know which outcome will prevail. What is evident, however, is that KRE has spent an extended period digesting prior gains rather than breaking down, which is constructive. Extended consolidation near resistance often reflects improving demand and the absorption of supply. If sellers were firmly in control, the price would likely already have rolled over. Instead, the ETF continues to hold its range. The immediate level to watch is the recent pivot high near $68.67. A sustained move through that level would put the $70 area squarely into focus. A clean breakout above $70—especially on rising volume—would be a decisive technical development and could signal renewed leadership from regional banks after years of underperformance. Conversely, repeated failures at resistance would increase the risk of a double-top formation. A rejection from this zone would suggest the sector still lacks the fundamental or macro support needed to sustain higher prices. 3 Ways to Position for a Potential Breakout Investors who expect a regional-banking breakout can pursue different approaches. For those who prefer diversification and shorter implementation, the KRE ETF itself is a straightforward option. KRE tracks the S&P Regional Banks Select Industry Index and provides broad exposure across U.S. regional and diversified banks. The fund manages about $4.3 billion in assets, carries a 2.37% dividend yield, and charges a net expense ratio of 0.35%. Roughly 78% of the fund's exposure sits in diversified banks, with another 15% allocated to regional banks, making KRE a clean way to participate without taking single-stock risk. Another potential way to gain exposure is via the iShares Russell 2000 ETF (NYSEARCA: IWM). While IWM might not be the first product that comes to mind when discussing regional banks, financials make up more than 20% of its sector exposure, with regional banks representing a meaningful slice. Sustained strength in KRE could therefore provide an underappreciated tailwind for small-cap equities more broadly, especially if improving bank performance signals healthier credit conditions and economic resilience. For investors willing to be more selective, individual names within KRE also present interesting setups. Huntington Bancshares (NASDAQ: HBAN), the ETF's seventh-largest holding, is consolidating just below long-term resistance near $18. That level has capped HBAN's price for several years, making it technically significant. A sector-wide breakout would likely increase the odds that HBAN clears this resistance and enters a new trend phase. Beyond technicals, Huntington offers a 3.46% dividend yield and carries a consensus Moderate Buy rating, with analyst price targets implying roughly 12% upside. A Sector Worth Watching Closely Regional banks may not carry the excitement of cutting-edge technology themes, but their positioning near meaningful resistance makes them increasingly relevant. Whether KRE resolves higher or fails at resistance, the outcome could influence sentiment across financials and small caps more broadly. As markets rotate and leadership shifts, the regional banking sector is approaching a moment investors would be wise not to ignore.
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