Are Barclays shares heading toward 2009 low?

After calling the decline in Barclays correct, our chartist reveals just how low this share could go.

A month ago, we devoted 29 words to speculate what would happen to Barclays' (LSE:BARC) share price if it floundered below 139p. Guess what, it did!

Unfortunately, the price broke our target 90p level repeatedly, which means we must now concentrate on worse potentials.

• Can Barclays shares make a turnaround stick?

The situation now suggests trauma if the price meanders below 79p. Such a ridiculous movement allows continued travel downward to an initial 47p. If broken, our secondary works out at 26p and (hopefully) ultimate bottom. We cannot currently calculate a bottom level below 26p.

There is something slightly interesting about 47p as an initial drop target. This matches Barclays low of 2009, presenting a point where most of the world shall anticipate a rebound. We’d advocate caution if 47p breaks on any initial surge downward. It will tend to make a bounce short-lived and worse, confirm the potential of 26p making a guest appearance sometime in the future.

At present, Barclays requires to trade above 110p just to suggest any recovery “might” be real. Moves above 109p calculate with an initial bounce target of 121p with secondary, if exceeded, up at a more reasonable sounding 135p.

For now, we’re not holding our breath but are wearing a face mask…

Source: Trends and Targets      Past performance is not a guide to future performance

Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, or interactive investor will be responsible for any losses that may be incurred as a result of following a trading idea.