Interactive Investor

HSBC shares and some genuine optimism

There's been a dramatic turnaround at this lender in the past couple of months. Independent analyst Alistair Strang checks the charts for signs that the good times will continue.

1st May 2024 07:35

by Alistair Strang from Trends and Targets

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    Something has changed with HSBC Holdings (LSE:HSBA)' price, the value of the shares being gapped up above a significant Blue downtrend which dates back to 2007.

    We are not inclined to view this price manipulation as an accident, instead suspecting the UK market feels it may be time for the financial sector to start producing some recovery.

    HSBC is already trading above the pre-pandemic high of 600p, this usually being the first big signal a share price is entering a proper recovery phase. The fact the market opted to gap it above this Blue downtrend should be the next big signal of good times ahead. This being the case above 703p should now promote a visit to an initial 718p with our secondary, if exceeded, calculating at 748p.

    From our perspective, this secondary target is quite a big deal, due to closure above 733p taking the share price into a zone with a long-term attraction coming from a future 898p.

    If HSBC intends to revert to the lacklustre performance of the UK stock market, their share price currently needs below 657p to cause trouble, risking a visit down to an initial 621p with our secondary, if broken, working out at 560p and hopefully a bottom.

    Oh, welcome to May and some genuine optimism for a bank's share price.


    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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