Interactive Investor

Can NatWest shares stage break out of current range?

8th May 2022 23:09

Alistair Strang from Trends and Targets

A recovery from the Ukraine sell-off has stalled and the shares have gone sideways. Independent analyst Alistair Strang updates his numbers in a hunt for clues as to future direction. 

The NatWest Group (LSE:NWG) share price looks more interesting than the Miami Grand Prix. Unfortunately, this isn’t entirely a complement, the race proving pretty uninteresting despite Max Verstappen looking like he’s heading for his first real world championship, if he can only finish races.

When we reviewed NatWest three weeks ago we warned of the dangers should the share price break below 206p, something it failed to do. We also mentioned an early sign of hope, if the share price would only exceed 226p. With breathless excitement, one day it closed at 226.4p, then, like Miami Formula 1, nothing much happened since.

We’re now a little nervous as to what the future holds for NatWest. In reality, it made an upward trigger, yet failed to respond.

The situation remains slightly unchanged, below 206p now suggesting the potential of reversal to an initial 194p and a challenge against the uptrend since 2020. If broken, our secondary is at 182p and a very possible bounce, given this matches the Russia/Ukraine low of March.

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

Importantly, though, closure below 192p risks proving quite traumatic from a bigger picture perspective, showing the potential of a further nose dive to 154p.
However, by just 0.4p, NatWest did manage above our trigger level, creating a situation where above 227p should now being miracle recovery to an initial 243p with secondary, if bettered, now calculating at 256p.

We suspect NatWest intends reversals.

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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