Lloyds Bank shares could rally – but does more pain come first?
The bank’s share price could recover to 50p, according to this analyst, but might fall before it does.
1st February 2021 08:44
by Alistair Strang from Trends and Targets
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The bank’s share price could recover to 50p, according to this analyst, but might fall before it does.
Lloyds Bank
When we last reviewed Lloyds Bank (LSE: LLOY) three weeks ago we were pretty confident a break of 34p would drive reversal to an initial 30p, with secondary, when (or if) broken, at an eventual bottom of 26p. The share price broke below our trigger level five days ago and is grudgingly moving down to our target level. It needs to exceed 38p simply to escape the immediate reversal cycle, something we're not inclined to hold our breath for.
Visually, it's still the case that an eventual 26p makes quite an attractive entry point, if the price ever gets there! The pace of reversal, so far this year, has been steady but very, very, slow.
It's probably important to remember things risk speeding up fairly soon. US earnings season reports risk causing trouble. Companies have been issuing repeated profit warnings due to earnings being squeezed during 2020.
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The coming week has results from BP (LSE:BP.), Exxon Mobil (NYSE:XOM), Otis and ScottsMiracleGro (NYSE:SMG), alongside a bunch of scientific and online retailers. The obvious question is: will negative reports be balanced by positive reports from eBay Inc (NASDAQ:EBAY), Pfizer (NYSE:PFE) and Alphabet's (NASDAQ:GOOGL) positive earnings?
For Lloyds to exceed 38p it would break the immediate blue downtrend, meaning the share could recover to an initial 44.5p with secondary, if bettered, a fairly cheerful 50p. As mentioned previously, moves this year tend to suggest 26p shall prove irresistible.
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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