Investment Ideas: December 31st, 2017

Citigroup (C)

Citigroup Inc. or Citi is an American multinational investment banking and financial services corporation headquartered in New York City.  It is the fourth largest bank in the United States.  Citi operates over 200 million customer accounts and employs 219,000 people.  It currently manages $1.8 trillion in assets.

One of our Investment Ideas newsletters featured Citi earlier this year.  We really liked this stock back then because it was breaking out of an ascending wedge pattern.  Since being highlighted in our newsletter, C is up about 20%.  That is a really nice move in just a couple of months.  Here's the newsletter if you want more info: Investment Ideas: June 12th, 2017

Hopefully, you were able to profit off this stock the first time we talked about it.  If not, or if you already locked in your profits, C is presenting another interesting investment opportunity.  For most of the year, Citigroup has been trending higher.  Recently the price action has formed an ascending triangle pattern.



 

This is one of my favorite patterns to trade.  If the price can break out above the top resistance line, the stock usually explodes higher.  Currently, Citigroup is above the 50-day and 200-day moving averages which is bullish.  RSI and MACD are both neutral.  I think it's likely that C is able to move above 76 in the next couple of weeks and continue its uptrend.

There are many catalysts for Citi and the financial industry as a whole in 2018.  It's definitely one of my favorite sectors going forward.  The Federal Reserve will likely raise interest rates 3 or 4 times next year.  This will increase earnings for the banks as they will make more money on their loans.  Tax cuts going into effect will be another catalyst along with GDP rising.  Lots of tailwinds for the financial sector that will help propel C higher.

Citigroup currently pays a dividend yield of 1.7%.

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