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#1


Lloyds Banking Group PLC forms bearish “Double Top” chart pattern
May 09, 2019

Recognia has detected a “Double Top” chart pattern formed on Lloyds Banking Group PLC (LLOY:LSE). This bearish signal indicates that the stock price may fall from the close of 60.89 to the range of 55.00 - 56.00. The pattern formed over 52 days which is roughly the period of time in which the target price range may be achieved, according to standard principles of technical analysis.

Tells Me: The price seems to have reached a top, after failing to break through a resistance level and ultimately breaking downward in a sign of reversal to a new downtrend. The Double Top pattern forms during an uptrend as the price reaches two distinct peaks at roughly the same price level. Volume reflects a weakening of the upward momentum, tending to diminish as the pattern forms, with some pickup at each high, less on the second high. Finally the price breaks down below the lowest low to confirm the bearish signal.

This bearish pattern can be seen on the following chart and was detected by Trading Central proprietary pattern recognition technology.


#2

On 7 March I wrote “Unless there is a Brexit deal, I expect the share price to generally remain below 63p and end the year drifting back possibly to 50p by December 2019. The buyback premium is already priced in when it was mooted in October 2018.”
Afterwards, a no Brexit deal was becoming unlikely and hence Lloyds share price rose above the 63p. However, the drift back to 50p is still on the cards.
I off loaded a few positions around 66p. Bought some back at 62p, 61p and intend to keep topping up all the way to 50p and offload each with 2p profit.


#3

It is starting to look like a very tradeable share with a good divi backing you up if you get the buy-in price wrong and have to hold longer than expected.


#4

Hi @eadwig. Well the FTSE 100 as a whole has a chart that looks pretty similar to your LLOY chart to me. (Sorry I’d like to stick a chart in here to illustrate my point but that’s not so easy to do on the iPad.) Perhaps that’s an ominous sign for the whole market ?, or perhaps both are suffering from Mr Trumps antics ?.

ATB

Pref


#5

For different reason, @PrefInvestor1. Both affected by Trump, but the other drag on LLOY is Brexit whereas with the ftSe 100 as a whole it tends to be the relative strength of GBP and also that of global markets with China posting some worrying PMI figures before the Trump debacle … if they can be trusted during such a negotiating period.

I have started to have my doubts about Chinese government figures recently but global commodity markets took those PMI figures seriously which hits a lot of big FTSE 100 companies too.

If the UK still had a manufacturing base it could be taking huge advantage of America’s tariffs against China, but I can’t think of any company in any sector that obviously will benefit. There must be some.


#6

I prefer to see graphical representations when discussing relative movements, so below one sees the following, taking January 1st 2019 as the starting point as per the initial chart in this thread.

  • FTSE chart
  • LLOY price chart
  • Relative performance of both LLOY and FTSE
  • Difference between LLOY and FTSE relative performance

    It seems that the factors affecting the FTSE are having a more negative effect than those affecting LLOY, with LLOY managing to hold on to most of its outperformance so far this year.

#7

Hi White_Rose

If you are prepared to buy all the way down to 50p or so ( if it goes there, do think it will bounce up a little before going that low but as always, could be wrong.) I think your strategy is superb.
You have a plan in place.

Hope it works out, think it will…

ATB

soi


#8

Hi @White_Rose, If you are prepared to keep buying down to 50p and the stock keeps falling, then you could end up holding as many shares as regardless !.

Just joking, I get the idea - but the thought of continually reinvesting in the same stock in that way is totally alien to me. But then trading really isn’t my scene.

Hope it works out for you…

ATB

Pref


#9

Hi @eadwig, Good day for your FTSE short !, so much for a boost from a US China trade deal.

Well Lloyds back into the 5Xs, Vodafone down 5%+ on dividend cut and results due tomorrow (not expected to be good), Tui and ITV down 6%+, Tesla down 5%+ and FAANG stocks all down 3-6%. Plenty of opportunity there for traders - none of them remotely on my radar. Dominion resources actually UP today I note…

FTSE the least damaged so far at about 0.55% down, GBP weakening today has probably helped.

Just sitting back watching it all myself, another tranche of divis due soon and plenty of opportunities to invest them.

ATB

Pref


#10

I sold my FTSE short and very likely to be buying FB later today. FB, GOOG etc (but NOT Apple) are not really touched by the trade tariffs, so their falls the last couple of trading days are really just the overall tide going out leaving many discounted stocks behind.

I have a large position in VOD. I’m afraid I’m going to be taking a largish loss on that, I can’t see any reason to continue to hold it in the foreseeable future. Just a matter of getting out at the least painful time, which may well be today. I am betting I can use the money elsewhere and recover losses long before the VOD share price looks like it may be returning to the nice high divi stock with enough volatility to keep trading around a position.


#11

Hi @eadwig, Well I hope that you made a good profit on it. As for VOD I gave this up as lost cause quite some time ago (I sold at ~155) and not sorry to have done so. The company faces many challenges - debt, regulatory approvals, soaring infrastructure costs, india situation to name but a few.

No idea why the market is bouncing back today, hope you get to buy in before the price has recovered too much.

ATB

Pref


#12

It was a good decision, I can’t see VOD regaining levels like that for over a year at least - and then only if things go well - and frankly there isn’t much sign of that anywhere in the mobile business. There is the small chance of them being bought out for a premium - especially if they keep falling as they are right now - as is the GBP they are priced in.

There has to be some consolidation but not all regulators will allow it. VOD were knocked back from consolidating in a small market like New Zealand a year or so ago. No surprise to see them sell off the business (announced yesterday) although continuing to support the buyers , they’re no longer prepared to try and introduce new and improved services which is proving so costly. And really, no sign of those costs stopping. After 5G what then? 6G, you can bet on it. And how much did 4G cost and who saw that much improvement?

Mobile has to be bundled with other types of communication like TV and entertainments to squeeze out a reasonable return on the large up-front and on-going costs, which is what VOD were stopped from doing by the NZ regulator. No doubt other regulators around the world will be seeing this as the warning shot across their bows I believe it is.

Market bouncing back because a lot of the UK-listed companies aren’t impacted at all by the China/USA debacle. In fact, some may well benefit from it.

These things are hard to unravel though where global supply chains are involved, so I would expect the markets to remain jittery for a while. China’s ‘retaliation’ has been laughably weak - that makes me wonder if they might no target specific US companies also. Face and all that. That could get nasty.

Ironically, one of my currently failing small cap investments would benefit greatly from China limiting exports of rare earths as they did in 2011 sending prices soaring. I held onto the stock largely because of the chance of that happening after Trump’s election. Its done very badly since for unforeseen reasons, but such a move from China would send it soaring.

Probably isn’t likely … first, WTO sorted out the original dispute and China would have to go back on that agreement, secondly, China withholding rare earths would mean a lot of green technology the world is relying on having to be re-designed and manufacture more expensive short term. Wouldn’t win them a lot of friends.


#13

Hi Again @eadwig,

China’s weak retaliation likely accounts for what looks to be a bounceback in the US market I guess, at least from what Futures are saying ATM. GBP down a bit more against the USD, probably helping the FTSE.

Regarding 4G, personally I think it is a MAJOR improvement over 3G and has made mobile data really useful and economic as far as I am concerned. I now get 1GB a month of mobile data for my £7 a month with 1500 minutes of calls and unlimited texts. This enables me to browse the market on my iphone extensively while I am out which was a problem in data volumes and in speed terms previously.

I see VOD is currently languishing in the 128s as I write this. Made it to 136.x at one point this morning but has fallen back. Was down ~8% in the US yesterday so the open there may inflict more damage, down 1.37% in the pre-market ATM. I see the Facebook has just dropped a bit at the open, guess you are probably watching that…

ATB

Pref


#14

mmmmm.
When 4G first came out EE were offering unlimited usage for about £30 a month I think it was in certain named cities and I thought I was going to be able to get my 20GB A DAY average usage on the move and do away with my fixed broadband at home … amazingly they shut down the offer really, really quickly, but not before I’d been told by every provider that they couldn’t actually deliver what I was after, not even close. Many couldn’t understand how I used so much data, but it isn’t hard if you’re streaming HD TV for example. I couldn’t understand how they couldn’t understand, given the hype surrounding 4G before its release.

5G at the moment is only likely to provide an improvement to heavy data users like me who are in areas that are already struggling to cope with the needs of 4G users. I wonder if some providers may end up offering a high end mobile offering and others a low end. It may even be that way for some countries except for one or two major cities. I think the New Zealand regulator may well have put his country out of the running for 5G anywhere but in Wellington, a second division mobile data country, doomed to be left behind.

Yes, I bought 2 tranches of FB today, one at $182.x and another @$179.x (both after all costs). First buy was too early when I thought the price wasn’t going to drop at all today, then suddenly it fell like a stone from $181.5 to 178.x. Unfortunately it hasn’t bounced back like most other ‘tech’ stocks, but I still think it is a discount price and likely to make me 5% or 10% over the next 1-3 months.

As for the USA coming back, to me this always looked like a 2 and a half day panic drop with half a day of bargains to be picked up on the way back up. The market gives us these ‘sale days’ every so often, though not as often as it used to. You can recognise them by the flight from ‘riskier’ stocks into ‘safe’ stocks. I hope I’m right. If so then almost all except a handful of stocks will be back to where they were within a week or so and there will be no sign of what looked like the end of the world a few hours into the second trading day.


#15

Hi Pref,

Which company do you use for your £7 p/m mobile contract?

Cheers,

Frog


#16

Hi @frog_in_a_tree, My mobile contract is with virgin media, for details see below:-

https://www.virginmedia.com/mobile/sim-only/pay-monthly-sim?contractDuration=12&tariffID=1709711619

ATB

Pref

PS Much of the time my monthly allowance is more like 1.5-2GB for my £7 as they roll over any data from your allowance that you didn’t use last month and add it on to your allowance for the next month. Network speeds are pretty good in my area too, but that just depends where you live obviously - same for coverage.

PPS I get 4 bars for network strength (that’s sitting here in bed). Did an ookla speed test and got 67Mb/sec download and 34.5Mb/sec upload - so pretty good speed wise.


#17

Many thanks Pref,

I am on O2 for 500 MB a month at £5 monthly. I never run out of phone or txt allowances but data often runs out when I am away from home.

Cheers,

Frog


#18

I am with O2 pay as you go

Only pay a tenner a month …


#19

Hi @regardless, @eadwig and @frog_in_a_tree , Yes there are many deals out there for less than £10 pm. But what do you get for that in terms of voice calls, data and texts AND more importantly what’s the coverage like and what data speeds do you get are the important questions !.

Allegedly even Vodafone have £7pm deal giving 3Gb, unlimited calls and texts. Might have to think about that one.

Sky is also an interesting player in that they apparently rollover all of your unused data for 3 years (according to their tv advert anyway…?). Some extra benefits in this if you have sky TV too.

Overall I’m not unhappy with my deal, it’s peanuts per month and does all I need. We never really use the home fixed line phone any more really, which as it’s costing ~£12 pm is annoying. That’s why I want to get a 5G router, unlimited data SIM and Sky Q then I can get rid of the home phone completely (avoids the bundling of broadband with home phone issue).

Just waiting for the right time to do it…(need to wait till my existing contracts expire, can’t leave before that).

ATB

Pref


#20

Hi @eadwig, Well clearly your experience has been significantly worse than mine. I get really quite acceptable performance from 4G (see my response to regradless’s post for actual figures). While I have never used more than about 1Gb in a month I don’t think that I would have any problems doing so.

I see that FB finished at $180.x. I have previously had a gamble on buying that stock but it’s never worked out for me. Some scandal always came along a trashed the share price. Won’t be going there again…

ATB

Pref