Created on: 4/13/2011 5:17:25 AM Last Update: 4/17/2011 8:58:22 PM Posted by: RTT
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Barry Ritholtz goes long Citigroup - Update (185)
This is an update to our post here . Lets have another look.
For the Affirmative:
1) Red 45 degree line break is imminent
2) TrendStatus positive, above ZERO. Confirmed
3) Hurst Cycle break of zero, imminent.
4) Financial sector may get a boost as other sectors are too expensive.
5) JPM earnings this Friday could boost the Financial sector, if this happens Citigroup(C) will skyrocket in our view.
For the Negative:
1) Volume not exciting (not shown, could not fit it in screen capture tool)
2) Financial sector is a laggard.
3) The Gann Angle trend is only 2 units of time for 1 unit of price (2x1). It would be smarter to find trades at least 1x1 time to price rewarding.
4) We (RTT) dont know the fundamentals behind Citigroup trade. Assume Barry has it sorted !
5) Market momentum will be timid in the US Summer (in our view).
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.."Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected"..
Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.
Nobel Laureate for Economics Paul Samuelson
My experience has been that in successful businesses and fund management companies, which performed well over the long-term, some courageous decisions were taken. Courageous fund managers reduce their positions when markets become frothy and accumulate equities when economic and social conditions are dire. They avoid the most popular sectors, which are therefore over-valued, and invest in neglected sectors because being neglected by investors they are by definition inexpensive. The point is that it is very hard and that it takes a lot of courage for a fund manager to avoid the most popular sectors and stocks and to invest in unloved assets. Finally, every investor understands the principle ‘buy low and sell high’, but when prices are low nobody wants to buy.
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