Citigroup (C) said last Wednesday that it was on the verge of raising $17 billion (at a price of $3.15 per share) from investors toward repaying its federal aid. That discount was much larger than expected, leading the Treasury Department to postpone its plans to start selling the government’s 34% stake in Citigroup. Treasury had expected to reap a substantial profit on the shares, which it acquired at $3.25, but selling now would instead result in a loss of hundreds of millions of dollars.
Citigroup’s chart appears to be on the down trend. The stock price is currently below 20D, 50D and 200D MA. If Citigroup breaks below $3.16 (50% Fibonacci Retracement Level), the next support is $2.655. I am planning to invest in this speculative stock and waiting for the right price to enter.