Technical Analysis of Financial Markets

Saturday, May 17, 2008

Citigroup, Inc. (C)

Totalling a record net loss of US$10 billion in the fourth quarter owing to its subprime mortgage holdings, Citi’s stock price has declined over 200% within a 12-month period tracing out an Elliot 5-wave formation. Current price action is finding support at the 50-day moving average where a b-wave of a bullish a-b-c corrective three-wave cycle may be developing. With a crossover of oversold stochastics indicating a buy signal, a c-wave formation may see a price target of $31 which serves as the 38.2% Fibonacci extension projected from the bottom of the five-wave decline.

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