Thursday, April 16, 2009

Citibank and Bank of America




Both the stocks' daily chart has already confirmed the buy signal as price has closed the moving average envelope and the MACD is now above the zero signal line. Both stocks also have bullish divergences found at the daily chart BUT both also have NOT formed such at their weekly chart. So at this moment I would only call this a technical rebound play and not one of those that you would buy for a longer term. The weekly MACD though are positive and rising in both cases but they are still "far" from thier respective zero lines.

For Citibank, I would watch for 9.00 / 12.00 as upside targets and keep as stops. As for Bank of America , upside targets would be 15.00 / 20.00 and keep 7.50 as stop.

I do not think the US financial sector's crisis is over, thus that's why we are only seeing a technical rebound and not a market terminal point. I think there are still plentiful of skeletons waiting to jump out at us. So trade these 2 stocks and do not harbor any thought of buy and hold yet.

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