We reviewed the chart of Citizens Financial Group Inc. (CFG) back in June when it was downgraded by our quantitative service. We commented, "a close below $33 on CFG will put the bear in control and tells us that this quantitative downgrade was timely. It will take a couple closes above $38 on increased volume to bring the bull back."
With hindsight we can look back and see that CFG weakened from June until early September. From a low below $32 in early September, CFG has rallied and made a number of closes above $38. The bull has taken back control. Now let's review our charts for a new strategy.
In this daily bar chart of CFG, below, we can see that prices are above the rising 50-day moving average line and the slightly rising 200-day line. In the beginning of November the 50-day average crossed above the 200-day line for a bullish golden cross. The daily On-Balance-Volume (OBV) line declined until early September and since then it has improved, telling us that buyers of CFG are now acting more aggressively. The trend-following Moving Average Convergence Divergence (MACD) oscillator has turned up to a bullish configuration.
In this weekly bar chart of CFG going back three-years, below, we can see that prices are now above the rising 40-week moving average line. The weekly OBV line has been edging higher all year and the MACD oscillator on this time frame is bullish.
In this Point and Figure chart of CFG, below, we can see a $50 price target. A new high at $42.65 will refresh the uptrend.
Bottom line - it's safe to get back in the water. Approach the long side of CFG here and on strength above $42.65. Risk a close below $37. For now, $50 is the price target.