Bullish Breakout Gap Citigroup breaking thru an important resistance level with a bullish Gap Up on good volume, in unison with the Financial Services Sector.
CITI trade ideas
📈 CITIGROUP GETS UP TO RECOVER, BREAKS THROUGH MULTI WEEK HIGHSCitigroup stocks hit highest since March 2022, last up 5% as brokerage Morgan Stanley upgrades NYSE:C to "overweight" from "underweight", as well as NYSE:BAC and NYSE:GS to "overweight" from "equal-weight".
Brokerage sees a rebound in capital markets amid growing signs of an imminent rebound in dealmaking. Also expects regulators to ease the Basel III Endgame proposals, a set of rules that will make capital requirements stricter for banks, which have been one of the flashpoints in the industry for months.
Brokerage says the proposals could be eased to be more aligned with Europe so that European banks do not have an unfair advantage.
Any easing of the draft rules will open the door for a significant increase in stock buybacks, as large-cap banks sit on the highest excess capital levels ever - NYSE:MS .
The main technical graph says that NYSE:C shares add +5.25% on Tuesday, break through multi week highs, with possible further recovery to multi year top $80 level.
Citigroup-Broadening formations, Right -Angled and DescendingThere was an upward breakout after the broadening formations (Right angled and descending). The breakout is nearing the end. Trading the pullback.
Target price:43.13
Stop loss: 58.71
Risk/Reward Ratio: 2.9
Citigroup Faces Tough Times: 20,000 Job Cuts, $1.8 Billion Loss
Citigroup, one of the largest banks in the United States, is navigating through challenging times as it grapples with a $1.8 billion loss in the fourth quarter of 2023—the worst in 14 years. The bank's CEO, Jane Fraser, announced a bold restructuring plan, including a significant workforce reduction of at least 20,000 jobs, about 10% of its workforce, as part of a broader effort to streamline operations and enhance returns.
The Financial Struggles:
Citigroup's fourth-quarter results reveal a $1.8 billion loss, attributed to $4 billion in one-off charges and expenses. These charges include $800 million tied to the restructuring, substantial hits from its exposure to Russia, and the devaluation of Argentina's peso. The bank's quarterly performance is the weakest since the aftermath of the 2008 financial crisis, underscoring the magnitude of the challenges it faces.
CEO's Response and Restructuring Plan:
Jane Fraser, Citigroup's Chief Executive, acknowledged the disappointing performance but emphasized the progress made in simplifying the organization and executing their strategic vision. The restructuring plan aims to cut costs and streamline operations, with a focus on reorienting the bank around its lines of business rather than geographical reach. Fraser plans to eliminate five layers of management, reducing them from 13 to 8, with business unit heads reporting directly to her. The cost of these changes is estimated to be as high as $1.8 billion but is expected to yield annual savings of up to $2.5 billion by 2026.
Job Cuts and Organizational Simplification:
Citigroup anticipates reducing its overall headcount to as low as 180,000 by 2025 or 2026, down from 240,000 at the beginning of the previous year. The bank had only cut 1,000 roles by the end of December, and the remaining reductions are expected to follow the completion of organizational simplification by the end of the first quarter of this year. Beyond the restructuring process, Citigroup plans to shed an additional 40,000 workers through exits from its consumer banking business in Mexico and other regions.
Financial Impact and Market Reaction:
Despite the challenging quarter, shares in Citigroup remained flat in early afternoon trading in New York. The bank acknowledges that the unexpected resilience of the U.S. economy has provided some relief, with credit card spending and corporate expenditures boosting revenues in the consumer banking and treasury services divisions, respectively. However, challenges in the corporate lending division, with a 26% drop in revenues, and a 25% plunge in revenue from sales and trading of bonds, commodities, and currencies, underscore the broader economic headwinds.
Conclusion:
Citigroup's announcement of significant job cuts, coupled with its worst quarterly performance in over a decade, paints a challenging picture for the banking giant. The bold restructuring plan led by CEO Jane Fraser signals a commitment to adapting to changing market dynamics and improving the bank's overall performance. As Citigroup navigates these turbulent waters, eyes will be on its execution of the restructuring plan and its ability to emerge stronger in the post-restructuring era. The coming months will be crucial in determining whether 2024 will indeed be the turning point predicted by the bank's leadership.
Potential Short setup on C.Thank you as always for watching my analysis. Please feel free to like, share, and comment! Happy, and Merry Christmas!
Citi's transformation will take it to $80. Volume confirmingStrong price action, watch results coming up on the 24th. Long.
C is over for goodCitigroup is likely done for good. After it dropped below the trend line during August, it did find support and bounce back. But imagine it found great resistance at that same trend line.
Yesterday it created a powerful reversal candle, a huge Gravestone Doji. Also, there is a huge possibility that if today gaps down, it would also represent an even stronger bearish reversal candle, an Abandoned Baby.
Oh boy, oh boy, this looks like C is done for a really long period of time and will revisit lows.
Also, the issue is, as this was made on huge volume, which confirms big boys did sell in this huge pump from yesterday, and they will likely continue to sell their stock.
Big red, aka 200 days MA, could be the first pause but could be only for days or so.
The chance for this not to drop hard is less than 20%
C, 9d/-11.97%falling cycle -11.97% in 9 days.
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This data is analyzed by robots. Analyze historical trends based on The Adam Theory of Markets (20 moving averages/60 moving averages/120 moving averages/240 moving averages) and estimate the trend in the next 10 days. The white line is the robot's expected price, and the upper and lower horizontal line stop loss and stop profit prices have no financial basis. The results are for reference only.
Next big move in CitigroupQuick Analysis about C:
Is filling the GAP on the Daily and we the news that they were doing a layoff of a lot of employees that brings more liquidity and the company could see a spike in the share price.
Biggest Resistance around 46 level, but if it breaks we could see the 47s and even the 48s. However if we go back below 44, we could get back to our previous support of 41/40.
THE END OF CITIBANKCITI is going to go Bankrupt
I will let the chart do the talking but their fundamentals now and since the Great Financial Crisis are in line with the chart projections
Timeframe: between 2030-2035
RIP CITI
C Citigroup Options Ahead of Earnings If you haven`t bought the dip on Citigroup here:
Then analyzing the options chain and the chart patterns of C Citigroup prior to the earnings report this week,
I would consider purchasing the 41.50usd strike price Calls with
an expiration date of 2023-10-20,
for a premium of approximately $1.06.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
Looking forward to read your opinion about it.
Earnings Journal█ SIMPLISTIC ANALYSIS </
Current Market Trend: short/sellers/negative.
Next Wave: buy wave to the rangeline.
Next Swing: negative swing to support.
Trade Type: Touch & Go don't wait for a close.
█ EARNINGS AT A GLANCE </
Release Date: 10/13 BMO
Earnings Anticipations: positive surprise for EPS & Revenues.
Surprise-Confidence on a scale of 0-5: #3
EPS & Revenue 2-Year Trend: the trend in EPS is negative, the trend in Revenues is positive.
█ SYNOPSIS </
"I expect the market will buy the surprise if the earnings report hits the Wall Street consensus, or sell the surprise if the earnings report misses the Wall Street consensus."
█ RESEARCH DEPTH: </
Technical Analysis: daily chart.
Fundamental Analysis: EPS & Revenue data.
Press/News: none.
Social Media: none.
$C: 40 acting nervousConcerned about the action I'm seeing out of financials but most especailly with NYSE:C here at 40. It is hard to see how this stock makes it out of the position it's in without going down further. We will be watching to see if bulls capitulate at 40 or not. Good luck traders
Level to watchBanks aren't sexy these days but check this level. Nothing to do at the moment, if you want to play safe wait until price breaks out the downline. If you are aggressive buy now and very tight SL (~37).
Citigroup breaking downCitigroup is another bank breaking down...
Until it can regain lost support (now resistance), its on a slippery slope with downward bias.
#citigroup #banks #inflation #recession #fintwit
Stocks pairs trading: WFC vs CI'm exploring a pairs trading strategy involving two giants in the banking industry, Citigroup (C) and Wells Fargo (WFC). Both banks are well-established and have a wide range of financial products, but there are key differences that present a trading opportunity. The idea is to go long on Citigroup and short on Wells Fargo, aiming to capitalize on their reversion to a historical relationship.
Why Go Long on Citigroup (C):
Valuation: Citigroup has a lower P/E ratio of 6.49 compared to Wells Fargo's 10.28, making it less expensive relative to Wells Fargo.
Dividend Yield: Citigroup offers a higher dividend yield of 4.82% compared to Wells Fargo's 3.15%. Over time, reinvesting these dividends could offer a significant advantage.
Restructuring Plans: Citigroup announced a major restructuring that could lead to long-term cost savings and operational efficiency. Although it may lead to short-term layoffs, the strategy is designed to bolster the bank's financial future.
Return on Assets (ROA): Citigroup's ROA is 0.56%, comparable to Wells Fargo's 0.87%, suggesting that both banks are effectively using their assets to generate earnings, but Citigroup offers a better valuation.
Why Short Wells Fargo (WFC):
Valuation: Wells Fargo's higher P/E ratio of 10.28 suggests that it might be overvalued relative to Citigroup.
Recent Legal Troubles: Wells Fargo is involved in multiple lawsuits, including one that accuses it of raising interest rates artificially on VRDOs (Citigroup accused as well). This could potentially affect investor sentiment and push the stock price down.
Debt-to-Equity Ratio: Although both banks have a significant Debt/Eq ratio, Wells Fargo's stands at 1.44, which is less than Citigroup's 2.77 but comes with a higher valuation, making it less appealing.
Decision:
Long on 1 C
Short on 1 WFC
$C - Looking for directionCiti looks interesting - there is horizontal support around 40.60 and price is also testing upper range of downward channel. Should we get a break to the upside, initial TP would be 48.50 - 48.90 - next level of initial resistance. Stop loss on a long from here would be a close below 38.70. As always, wait for confirmation of breakout before entering any long position.
Long entryGood long opportunity here. I'll be writing some $39 puts here for the premiums.
Use a stoploss,
thanks
$C with a bullish outlook following its earnings #StocksThe PEAD projected a bullish outlook for NYSE:C after a positive over reaction following its earnings release placing the stock in drift B with an expected accuracy of 50%.
Citigroup's Struggles (C:NYSE) Underperforming Stock and Concerns over Business Transformation: A Closer Look at Citigroup's Valuation
Citigroup's stock has been underperforming despite its relatively cheap valuation. Investors have expressed worries about the potential execution risks associated with the bank's ongoing business transformation efforts. This has raised questions about the effectiveness of the strategies being implemented to drive growth and profitability.
Q2 Earnings Report and Cost Control Challenges: Examining Operating Expenses and Revenue Trends
In its Q2 earnings report, Citigroup reported a 9% year-on-year increase in operating expenses, reaching $13.6 billion. Interestingly, this occurred alongside a 1% year-on-year decline in revenue, highlighting concerns about the bank's ability to effectively control costs. The disparity between expenses and revenue growth is a key focus for investors as it directly impacts the bank's profitability and long-term sustainability.
Management's Confidence and Expense Outlook: Assurances from Citigroup's Leadership
Despite the challenges, Citigroup's management remains confident in its ability to address cost control concerns. They have expressed their commitment to "bend the cost curve," suggesting a strategic focus on optimizing and streamlining operations to achieve greater efficiency. Additionally, management has assured investors that the near-term expense outlook remains unchanged at $54 billion, indicating a willingness to address cost-related issues proactively.
Conclusion:
Citigroup is currently facing performance challenges with its stock underperforming and concerns over executing its business transformation effectively. The Q2 earnings report revealed a notable increase in operating expenses despite a decline in revenue, raising questions about the bank's ability to control costs. However, management remains confident in its ability to address these issues and is committed to bending the cost curve through strategic measures. As the bank continues its transformation journey, investors will closely monitor its progress and actions to assess its potential for improved performance and shareholder value in the long run.
This content is provided for general information purposes only and is not to be taken as investment advice nor as a recommendation for any security, investment strategy or investment account.
#C trade plan up to 15-SepDetected 21 - Jul straddle is significant. More than 2.4M$.
We primarily consider levels to be activity zones, but not to be a super-fine level for establishing a limit order. Use them in combination with our own strategy, not in alone.
Stay tuned!
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Keeps pushingPrice keeps pushing higher. It found the downtrend resistance but it wasn't pushed back down to hard. Actually the price is testing again the resistance and I think eventually is going to break up. We may see another small rejection but bulls are in control at the moment. The nice this thing about this trade is that Citigroup pays dividends (%4.03 yield, not bad). So you can enjoy the dividends while you wait for a break up.
