Breakout or Fakeout?
The trigger for this rally was an internal memo to the Citigroup employees from Vikram Pandit, designed to bolster morale and most likely the stock price when it was widely leaked to the press. Vik gets a freebie on this one since the memo was 'internal.' No accounting for numbers, right? lol.
Citi CEO Pandit Defends Group Strength
Traders are choosing to interpret this as a positive sign that 'the worst is over' and are squeezing the short interest from an oversold condition. Here is a story on Citi from the WSJ. Does this sound like all is smooth sailing?
U.S. Weighs Further Steps for Citi: Regulators Plan for Contingency - WSJ
Anyone who actually believes the financial crisis is over based on this 'leaked internal memo' is a true believer indeed. In what we are not sure.
Let's see how this rally plays out. Here are the support and resistance levels.
Anything is possible here in the Speculation Nation.
By the way, Turbo Timmy Geithner will be on PBS' Charley Rose talk show this evening. He will say that things are getting dramatically worse in the US economy. But they are committed to fix our dire financial problems no matter what they must do. (hint: print).
