Interactive Investor

Why it might not be plain sailing for Barclays shares

31st January 2022 07:30

Alistair Strang from interactive investor

Barclays and the bank sector have outperformed the wider market over the past year. Can they keep it up? Independent analyst Alistair Strang checks the charts.  

Three weeks ago, when we reviewed Barclays (LSE:BARC), we gave an initial target of 218p. The share price, for a pleasant change, managed to perform in adherence to our imaginary rules, reaching 219p on the initial surge but,  crucially, the share failed to close above 217.1p. Perhaps some growth is indeed coming, just not right now apparently.

We actually are fairly optimistic for the future but suspect some near-term reversals can be expected.

Near term, below 193p looks capable of driving traffic down to 187p. If broken, our secondary calculates at a less likely 182p. We’ve deemed 182p as “less likely” simply due to this taking the price below the immediate Red uptrend.

This risks being a dangerous movement, taking the share into a region where arguments start to accumulate favouring eventual reversal to 159p. Instead, we’d hope for a bounce, should 187p make an appearance.

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

For things to start looking interesting for Barclays, the share price presently to needs exceed the previous high of 219.6p, as we now expect movement to 230p fairly soon thereafter.

Our secondary, if such a level is exceeded, now works out at 241p but for those blessed with patience, the share price shall find itself in a region where we can mention a distant 292p without giggling.

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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