Why I'm not convinced by Persimmon's rally
UK housebuilders just received a massive boost from a new government initiative, but independent analyst Alistair Strang worries about what's in the small print.
29th September 2026 07:21
by Alistair Strang from Trends and Targets
We strongly suspect the domestic housebuilding industry flourish shall prove to be a flash in the pan, curious about who actually qualifies for Andy Burnham's new Help to Buy scheme. Fear is it will be an initiative torpedoed by small print.
From our sceptical perspective, we need Persimmon (LSE:PSN) to close a session above 1,401p before we shall dare believe the share price is exhibiting true growth potentials. It’s probably true that above 1,350p shall prove capable of promoting movement but we’re cynical, due to man-made immediate movements we regard as “pretend”.
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There is an interesting immediate signal, the blue downtrend since 2021 currently sitting at 1,330p. As the chart extract below shows, the market refused to let Persimmon's share price actually close the session above the trend.
Source: Trends and Targets. Past performance is not a guide to future performance.
Conventional wisdom among brokers is to propose Persimmon as being in a 'no brainer' position, where every day in the future promises to be a happy one. As the two chart extracts above show, we’re not entirely sold on this concept; quite the opposite in fact as we suspect the immediate cycle of gains to be fake.
If we’re right, below 1,301p has the potential to trigger reversals to an initial 1,178p with our secondary, if broken, at a hopeful bottom at 1,094p. Though we can paste on a potential third level “bottom” at 1,019p, this is not a tidy situation.
Our alternate “happy” scenario, if the brokers gagging about upward potentials prove correct, demands we wait until such time Persimmon's share price exceeds 1,401p as this should signal a recovery cycle commencing to an initial 1,645p with our secondary, if exceeded, working out at a future 1,781p.
This is all quite a big deal, giving a big-picture suggestion that a future 2,414p is dangling a distant attraction somewhere in the mists of time.
Our kneejerk is to anticipate reversals for Persimmon.
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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