Citigroup Bullish Flag, Possible EMA Cross

Citigroup recently announced positive earnings and despite the good reports, the stock price has consolidated in recent weeks. Citi has also lagged the major indices, but technical indicators are saying that the trend is about to reverse almost immediately.

Goldman Sachs issued a stockwatch today for several stocks including Citigroup and the chart above may help you to profit from a bull flag indicator that has taken place since the beginning of October which had some analysts worried about the financial sector due to the fact that it had been lagging the market.

I think that the flattening in the RSI and the 50% pullback on the slow stoch combined with the impending 50/200 day EMA cross validates the consolidating bull flag and proves that Citi is undervalued compared to the market at this point. The selling volume has also dried up and it looks like it could reverse very shortly… perhaps a large positive volume spike will take place in the next few days. In any case, this chart says that C is on that verge of breaking out to the upside and it appears that there isn’t much time left before it begins to catch up with the market.

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About Aaron Basile
Market Technician, Equity/Commodity Trader, Austrian Economist, Contrarian Investor

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