Options Corner: Citigroup (C) First Place in Financial Group

Core Viewpoint - City has significantly outperformed the S&P 500 and the XLF financial sector ETF, with a year-to-date increase of over 56% compared to the XLF's 10.6% [2][3] Performance Analysis - City is leading among large financial institutions, with Goldman Sachs following closely behind, indicating a favorable environment for these companies [2][3] - The one-year chart for City shows a triangular pattern with converging trend lines, indicating a breakout from a previous range of $96 to $104, where old resistance has turned into new support [3][4] Technical Indicators - Moving averages are diverging, suggesting a strong continuing trend, while the RSI is in the overbought area, indicating strength in the market [5] - Volume profile analysis shows heavy trading activity around the $95 level, with significant concentration above $100 and another node near $110, indicating potential support levels [6] Trade Strategy - A potential trade strategy involves a call butterfly trade for January, with an expected move of about 8%, targeting a range between $110 and $125 [7][8] - The proposed trade would involve buying the 110 and 125 calls while selling two of the 120 calls, with a maximum profit of $650 if executed correctly [9][10] - The trade captures earnings and has higher implied volatility, allowing for the option to sell before the earnings event if market conditions are favorable [11]