In 2024, Citigroup’s stock (C) has outperformed major equity benchmarks, with a year-to-date gain of around 22% compared to the S&P 500’s 13%. Despite this strong performance, a detailed technical analysis using multiple time frame analysis indicates a potential downside reversal. The weekly chart reveals a sharp and consistent rise in Citigroup’s stock price, reaching a peak at $65 from an October low of $38. Key indicators such as the weekly PPO signal and moving averages confirm the strength of the uptrend. However, recent signals, such as the sell signal from the weekly PPO indicator and bearish momentum divergence on the daily chart, suggest a possible trend reversal.
Indications of a Potential Downtrend
The weekly chart of Citigroup’s stock shows signs of a potential downtrend, including the reaching of a 61.8% Fibonacci retracement level and a sell signal from the weekly PPO indicator. These indicators suggest that the previous uptrend phase may be coming to an end. Additionally, the daily chart highlights a bearish momentum divergence with higher price highs and lower RSI values, indicating a lack of upside thrust typically seen at market tops. If the RSI breaks below the 40 level in the coming weeks, it could confirm a new bear phase for Citigroup.
Citigroup’s stock has recently broken below its 50-day moving average for the second time in 2024, a potential sign of exhaustion in the previous uptrend phase. The failure to regain the 50-day moving average could indicate further downside. Moreover, the relative strength indicator shows Citigroup underperforming the S&P 500, suggesting weakness in the stock. Key support levels to watch include the April low around $57, which aligns with a previous swing high from late January. This level could act as a magnet for price action, potentially leading to a bounce in the stock price.
Investors in Citigroup should be cautious of the technical signals pointing towards a potential downtrend in the stock. From bearish momentum divergences to moving average breakdowns, the stock is displaying classic signs of upward exhaustion. While strong trends often lead to strong returns, it appears that Citigroup’s stock may be signaling a shift in momentum. Investors should closely monitor key levels and indicators to determine the future direction of Citigroup’s stock price.