Is it party time for Barclays shares?
Up over 50% in 2024 and breaking above a long-term downtrend, independent analyst Alistair Strang reports on prospects for this high street bank.
14th October 2024 07:18
by Alistair Strang from Trends and Targets
At 9pm on Saturday night, outside and looking at the sky, there were three stars in a neat row, a formation which had no business being in the sky at that time of night.
Suddenly, the middle "star" moved, heading in the direction of the southern one, then reversed, moving at the sort of speed expected when the International Space Station meanders through the night sky. We’d officially watched something “Unidentified”.
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For a change, our leader article actually relates to our discussion topic, mystery signs which simply cannot be clearly identified. Barclays (LSE:BARC) keeps showing optimistic signals, suggesting the share price might actually move in a positive direction. Maybe like our unidentified light in the sky, it simply needs sufficient numbers of folk to believe in it.
Our latest “positive signal” for Barclays comes from the point at which the share price closed the session on Friday 11 October. By closing at 235.85p, the share price managed to finish a session above a downtrend which dates back to a silly sounding February 2007.
When we extrapolate on this particular trend line, on Friday it needed to close above 235.229p and, by a less than impressive 0.3p, this feat was achieved. Perhaps it’s meaningless, perhaps it’s the case the market is conceding this share price could actually become useful.
Currently, we shall be inclined to take movements above 241.65p, the prior high before the trend was exceeded, at holding the potential of triggering share price shuffles toward an initial 255p with our longer-term secondary, if this initial is exceeded, calculating at a future 316p. To judge by historical behaviour, we shall not be surprised if the 316p level experiences some hesitation.
Should things intend to go wrong, Barclays' share price needs to diminish below 216p to cause trouble, risking promoting reversal to 194p with our secondary, if broken, at an eventual 162p.
We do have a suspicion, if such messy reversals are triggered, we would hope to see the share price bounce well before our secondary target at 162p, ideally around 180p.
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.
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