Is Citigroup Waking Up

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.