The Big C is Still Important
Before and going into the GFC, Citigroup was once the most important stock in the world. At least that’s how it was referred to by a certain Technical Analyst. It’s no longer the most important stock in the world (you can choose any of the Big 7 Tech stocks now), but it’s still a heavyweight since it’s the 10th biggest component of the S&P Financials Sector and it’s the 4th biggest US bank.
With a weak Technical Score = 1 (scale 0 – 4), the stock’s price action over the last several weeks has been a bit of a concern to us. For example, it hasn’t made any price progress since early Jan 2021, it is below its downward-sloping 50- and 100-day moving averages, it is below its 200-day moving average, daily momentum is in negative territory, weekly momentum is toeing negative territory now (see chart below), and monthly momentum is cresting. Too, and you’ll get the sense of this immediately via the chart below, C was turned away from the 80 level with great prejudice in the summer of 2021 just like it was in Jan 2018 and early 2020 when it declined to just below 50 and then the COVID low of 32. C is also weak vs. the S&P Financials and Diversified Bank Index which have Technical Scores of 4 and 3, respectively.
Citi has risk to 50 or, as noted in the chart, “the bottom of its range.”
