Are Barclays shares really heading back to 10-year low?
The coronavirus-driven market slump is creating some cheap shares, but there are big risks here.
28th January 2020 09:13
by Alistair Strang from Trends and Targets
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The coronavirus-driven market slump is creating some cheap shares, but there are big risks here.
Our previous commentary on Barclays (LSE:BARC) expressed concern should the share price be gapped below the Blue downtrend on the chart.
Unfortunately, thanks to market jitters blamed on a virus from China, the Gap of Doom was inflicted at the open on the 27th, creating a GaGa scenario.
This absurdity allegedly placed Barclays under threat of reversal to 110p eventually!
Thankfully, we have doubts as this little dose of nastiness appeared almost worldwide, as markets attempt to convince traders and investors an apocalypse is coming.
We’re pretty far from convinced presently, suspecting quite the opposite to be honest. London would almost be enacting a public service, attempting to convince investors to panic and thus free up some reasonably priced shares, prior to a future rise.
However, we dare not ignore Barclays being pushed below the trend, now residing in an area where weakness next below 169p looks perfectly capable of an initial 163p. If broken, secondary is a visually less comfortable 155p. This level creates a real problem, dumping the share price into a zone where a jittery market or negative news could drive Barclays down to 140p.
If we pretend some optimism, Barclays need only exceed 176p and it feels capable of triggering movement up to 182p initially. If exceeded, secondary comes in at 192p, along with the need to review the share price again.
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.
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