Barclays shares are ticking the right boxes
Despite a largely sideways trend for a few years, there have been trading opportunities at this high street lender. Independent analyst Alistair Strang explains why he thinks this could be another one.
5th February 2024 07:49
by Alistair Strang from Trends and Targets
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All dog owners are guilty of “the pretend throw”, tossing something over the dogs head in the hope it chases after a feint, until the point when the owner is given the dread suspicious side-eye.
We’re a little afraid we may be about to fall victim to a feint from Barclays (LSE:BARC) as the share price has been ticking a number of attractive boxes recently.
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The first box to be ticked came from our report on Barclays three weeks ago. We’d dangled the potential of a very possible bottom price level at 136.3p, along with a strong potential for a bounce if such a level was achieved. Real life saw the share weaken to 138.5p, then start to bounce. We always like it when a price bounces just above a drop target level as this often signifies some hidden strength.
The second item of interest came on Thursday of last week, the price gapped down at the open, and on Friday it was gapped up. This GaGa dance step is one we find frequently attractive as it’s generally a pretty solid suggestion the market in about to indulge a cunning plan for price gains.
And the third item is one we’re a little less optimistic about, the share prices behaviour in relation to the Blue downtrend since February of last year. For some reason or other, the price is once again respecting this downtrend.
And thus, similar to a recent ‘foster’ dog called Badger, we’re primed and ready to chase brainlessly after Barclays' share price, if the market opts to hit a pretty obvious trigger level. Above just 151.7p (last Friday's high) calculates with the potential of a lift to 155.5p with secondary, if bettered, working out at a comfortable looking 158.6p.
And it’s this secondary target which is provoking plenty of self doubt, representing a new “higher high” for the share, one which implies a pretty strong suggestion of a return to a future long-term 173.1p and a price level not seen for just 12 months.
Hopefully we’ve not taken the bait, providing a set of targets while the market giggles behind a concealing hand. But for things to start going wrong, Barclays now needs to slink below 145p to risk a path to 142.3 with secondary, if broken, a disheartening 139p.
Our suspicion, ever the optimists, is we’re about to see the first ball thrown in a path to an eventual 173p.
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.
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