Lloyds Bank shares cannot afford to close below this level
Amid more misery for shareholders, our chartist stirs the tea leaves to find important price points.
16th April 2020 08:45
by Alistair Strang from Trends and Targets
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Amid more misery for shareholders, our chartist stirs the tea leaves to find important price points.
Lloyds Bank (LSE:LLOY)
We berate the media for their never ending doom and gloom, then realise we can be guilty too.
Last month, we warned of danger should Lloyds Banking Group (LSE:LLOY) slip below 47.8p and it did, 'successfully' hitting our drop target of 31p.
We're genuinely not proud about this sort of thing, just rather concerned thanks to Lloyds breaking our drop target briefly on the initial surge downward.
Similar to yesterday's glance at Barclays (LSE:BARC), we now need to stir the tea leaves again and recalculate future potentials.
At present, the share is trading at around 29.75p.
There's a pretty obvious trigger level residing at 27.7p as traffic below such a level is liable to deflate the share price down to an initial 26.7p.
If broken, secondary calculates down at 21.25p and we've really hope for a reasonable rebound, if such a target level appears.
The big problem, if the price closes below 21.25p is the retail bank share price enters a region where our "ultimate bottom" works out at a silly sounding 5p.
One ray of hope with a target of 21.25p is it matches the low of 2011, when Lloyds Bank was given its final kicking thanks to the financial crash of 2008-09.
Should the share price explore such a hideous depth, there's an entire nation of chart watchers who will doubtlessly assume "double bottom", jumping in to catch a solid rebound.
We need to remind, yet again, this share cannot afford to close below such a target level as the implications are worse than a Downing Street press briefing.
Slightly better news is possible, if Lloyds would find sufficient reason to now trade above 35p.
We hope this shall present itself as a trigger level to drive recovery up to an initial 40p with secondary, if exceeded, working out at a longer-term (or next day) target of 48p.
Above such a level, it will be essential we return to tea leave stirring duties but certainly a sigh of relief will be justified.
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.
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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