Barclays shares doomed until Brexit conclusion
After a rally fizzled like a cheap firework, this successful analyst believes this bank may be trapped.
21st November 2019 09:01
by Alistair Strang from Trends and Targets
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After a rally fizzled like a cheap firework, this successful analyst believes this bank may be trapped.
Barclays PLC (LSE:BARC)
Once a month we review the retail banks, once a month we report nothing is really happening. It's like trying to find something new to write about Brexit, a subject already flogged to death but like all good masochists, we shall try once again to make sense of Barclays (LSE:BARC) and the future.
The immediate problem we face with this has been a lack of proper recovery. Our last review speculated on movement from 154p to 161p to 177p and the best the share achieved was just below 174p where it fizzled like a cheap firework.
While we can now report movement above 174p should bring a confident looking 179p, the longer term secondary calculation of 187p looks considerably less likely. In fact, it becomes easy to calculate a distant 204p as viable, if any of this scenario comes to fruition.
Of course, there's an additional problem. The ruling downtrend (blue) is presently at 177.173p and the market has carefully respected this line since July 2015.
This level of homage tends make us suspect the share price shall remain trapped until such time the UK's future appears settled, a subject of considerable doubt at present.
If the markets intention is to keep Barclays "trapped" until a route to the future appears, we shall not be aghast if weakness now below 164p forces reversal to 159p with secondary, when broken, at 154p and hopefully a rebound.
For Barclays to get into serious trouble, the share price now needs break below red, presently at 136p. Such a calamity looks capable of driving 126p, a short term bounce, then a further trip down to 110p and hopefully a real bounce.
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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