Is Citigroup Waking Up

Apr 5, 2008: 10:42 PM CST

Citigroup (C) is showing initial strength on the daily chart and may be ready to try for a reversal.

Price is struggling to break above the 50 period moving average, which has served in the past as key resistance. Price remains in a strongly confirmed downtrend, but a recent increase in momentum may be a signal that this downtrodden stock may be awakening after a major decline.

Before getting super bullish, I would recommend you wait for a potential strong close above the flattening 50 period moving average.

Also, the red ‘trend’ line on the bottom panel indicator has now crossed the zero line, signaling an aggressive buy signal.

Let’s see how far this stock has fallen:

From a mid-2007 high above $53, the stock recently tested levels beneath $20, falling more than 50%.

A momentum divergence has formed on the weekly chart, which could precede a potential reversal (or at least consolidation phase where the stock will build a base for a reversal).

And how does Citigroup compare with other stocks in its industry?

Over the last 200 days (since mid-June 2007 before the ‘plunge’), Citigroup’s peers have performed as such:

JP Morgan Chase (JPM): -5.63%
Wells Fargo (WFC): -10.8%
Bank of America (BAC): -17.63%
Wachovia (WB): -46.4%

Actually, Wachovia’s chart and pricing looks very similar to Citigroup’s.

Keep an eye on some of these key stocks, as it’s been said Financial Stocks lead the market up and down.

6 Comments

6 Responses to “Is Citigroup Waking Up”

  1. Is Citigroup Waking Up | Great Trade Says:

    […] Trade wrote an interesting post today onHere’s a quick excerptCitigroup (C) is showing initial strength on the daily chart and may be ready to try for a reversal. Price is struggling to break above the 50 period moving average, which has served in the past as key resistance. … […]

  2. Buy » Is Citigroup Waking Up Says:

    […] Afraid to Trade.com Blog wrote an interesting post today on Is Citigroup Waking UpHere’s a quick excerpt Citigroup (C) is showing initial strength on the daily chart and may be ready to try for a reversal. Price is struggling to break above the 50 period moving average, which has served in the past as key resistance. Price remains in a strongly confirmed downtrend, but a recent increase in momentum may be a signal that this downtrodden stock may be awakening after a major decline. Before getting super bullish, I would recommend you wait for a potential strong close above the flattening 50 p […]

  3. vinaydh Says:

    Can you please tell me what indicators are you using for the bottom panel? Some how I am not able to recreate them in prophet charts. I tried MACD and RSI but they look different than your charts.

  4. vinaydh Says:

    Can you please specify the indicators being used in the bottom panel?

  5. Corey Rosenbloom Says:

    Vinaydh,

    I’m actually using the standard MACD indicator on StockCharts.com, but have tweaked the inputs to 3, 10, 16 respectively. This is commonly known as the “3/10 Oscillator” which is the difference between a 3 and 10 SMA (actually StockCharts uses a EMA) which is then smoothed 16 periods. It serves as both a trend and a momentum oscillator.

  6. vinaydh Says:

    Yeah I had figured it out from the “My Strategies” link on this blog. I still see a little difference but that may be due to stock charts using EMA. Thanks a lot for your help. I find your blog very informative.