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Two Ways To Play: Lights Stay On in the Citi

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Strengthen your portfolio in good times and bad.

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Citi Rescued

If Citigroup (C) has 9 lives, it just used up at least 1. According to Reuters, the US government has opted to bail out the bank, injecting about $20 billion of fresh capital and agreeing to shoulder much of the potential losses on $306 billion of its riskiest assets.

In return, the government will receive preferred shares with an 8% dividend. The bank's top executives will keep their jobs, but Uncle Sam will have final say over compensation packages. Citi shares rose over 40% in European trading.

For more ideas, see Minyan Mailbag: Gold Will Rally - But Will Gold Stocks? by Professor Lance Lewis.

From the Bull Pen: Does this clear the way for a large rally into year-end? Those bullish can consider the Gold ETF (GLD). Recovering its 50 DMA is healthy and sell stops can be set below that level, or 2 points from entry.

From the Bear Cave: For those that believe the rally in the US dollar is exhausted, one play to consider is the Dollar Bearish Fund (UDN). Sell stops can be set near $24.


Quick Check Around the World

Asian trading closed with the Hang Seng -1.59%, Sensex -0.14%, Taiwan -0.25% and Shanghai -3.67%.

Glancing towards Europe, we see the CAC 4.47%, DAX 3.47%, FTSE 4.67%

As of 8:00 a.m. EST, S&P futures are trading +21 to 813, and Nasdaq futures are +18 to 1109.


A Look At Commodities

Crude oil is trading +1.78 to 51.70. Gold is +27 to 819.20. Silver is +0.445 to 9.925 and copper is +1.820 to 157.10.

The dollar index is -1.370 to 86.825.


On the Radar

Economics

10:00 Existing Home Sales
10:00 Existing Home Sales MoM

Click here for the full trading radar.

Happy Monday! Have a great day!

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No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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