As mentioned back then, Citigroup was in a frenzied rally that saw prices surged outside the envelope even when indicators were moving south, thus creating a divergence. $4.22 was the price level to hold; it didn’t and when that level was breached, all hell broke loose resulting in a short term sell off that saw prices sink back to value.
However, do remember that it was based on a reading from a single time-frame, sampling data that was gathered from only a few weeks which is why I did not expect the sell-down to continue for a long time. Most importantly, the upper time frame (weekly chart) was still moving up (green impulse) and past experiences tells me that the buyers will most likely return near the value zone (the price range between 2 moving averages). It was no coincidence that that sell down found support at $4 as that had been a congestion zone for the previous weeks. Prices rebounded from the value zone in zest after scratching the value zone.
Today, again, we see a price surge with the prices touching the upper envelope limit again. The MACD-H looks like it could form a divergence as well and this could be in fact a “class A” type (the most powerful!). I say DO NOT over-anticipate! Remember, the upper time-frame (weekly), is still bullish. This current time-frame (daily) is also bullish. I want to see a confirmation before I decide on my next course of action – the support to hold, this time round, is at $4.40.