The financial sector has been one of the best-performing groups at a time where tech stocks are falling hard and as the market remains in a state of uncertainty.
However, today’s mixed picture may not do the bulls much good. We’ll see how the group trades next week when more banks report, but for now let’s look at the charts.
Trading Citigroup Stock
Unlike some of its peers, Citigroup was trading quite poorly until recently. Shares hit a new 2021 low in December near $57.50 before reversing higher and gaining some nice upside momentum.
In fact, the stock is clinging to its fourth straight weekly gain as we speak.
Amid the dip, buyers are stepping in at the stock’s 10-day moving average. That’s healthy buy-the-dip action — assuming it holds.
If it doesn’t, let’s see if the 50-day and 200-week moving averages can buoy Citigroup stock, alongside uptrend support (blue line).
The trouble lies in a break of the 21-day moving average. In that scenario, $60 could be in play, followed by the December low.
On the upside, let’s see if Citigroup can clear this week’s high up at $68.65. If it can, it puts the 200-day moving average in play.
Trading Wells Fargo Stock
As for Wells Fargo, the stock has been trading much better than Citigroup, as the chart above illustrates.
Last week, the stock erupted from sub-$50 to more than $55 at one point, ending the week near its highs.
Not only is this area the high from late-2019 and early 2020, but it was also channel resistance.
I would love to see this be the start of something larger, that being a big move to the upside now that the stock has broken out and after years of underperformance.
If shares are to pull back in the short term though, let’s see if this $55 area acts as support. If so, it could be a buying opportunity.