Following some upbeat forecasts for the financial sector and with JP Morgan announcing a 43% dividend increase, financial stocks soared today. From my analysis of the sector, C appears to have the most bullish chart at the moment and should be a top pick in the financial sector at this time.
Today, C broke out of an inverse head and shoulders pattern. Inverse head and shoulders are among the most common and most reliable reversal patterns in technical analysis. With the breakout from the neckline, the pattern provides a price target equal to the size of the head from the neckline (the cloned and placed blue boxes). With multiple supports now below the current price and a price target of $82 it offers a fantastic risk/reward long play. This represents an 11% gain over today's close in the short term (~3 - 6 months). I entered a long equity position today. I think it is fairly likely that C re-tests the neckline, in which case I will be buying long call options if any re-test fails, or on any pullbacks to its price target.
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As always, the responsibility for managing your position is your own. I am not a financial adviser nor is any content in this post intended to be financial advice. The information presented is my opinion, based on tools I have learned from others sharing their opinions and my experience in the markets. I share these ideas to generate discussion and have others critique my analysis because, as always, I am still learning. With that in mind, the outcome could be quite different than what I am predicting and this is for entertainment purposes only. It should not be considered financial or investment advice of any kind. Readers should consult with a financial or investment professional to determine what may be best for their individual needs.
Today, C broke out of an inverse head and shoulders pattern. Inverse head and shoulders are among the most common and most reliable reversal patterns in technical analysis. With the breakout from the neckline, the pattern provides a price target equal to the size of the head from the neckline (the cloned and placed blue boxes). With multiple supports now below the current price and a price target of $82 it offers a fantastic risk/reward long play. This represents an 11% gain over today's close in the short term (~3 - 6 months). I entered a long equity position today. I think it is fairly likely that C re-tests the neckline, in which case I will be buying long call options if any re-test fails, or on any pullbacks to its price target.
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As always, the responsibility for managing your position is your own. I am not a financial adviser nor is any content in this post intended to be financial advice. The information presented is my opinion, based on tools I have learned from others sharing their opinions and my experience in the markets. I share these ideas to generate discussion and have others critique my analysis because, as always, I am still learning. With that in mind, the outcome could be quite different than what I am predicting and this is for entertainment purposes only. It should not be considered financial or investment advice of any kind. Readers should consult with a financial or investment professional to determine what may be best for their individual needs.