Why Lloyds Bank shares still have potential
There's been a pause following a three-month rally, but the lender's share price could spring to life after this major event, writes independent analyst Alistair Strang.
24th June 2024 07:41
by Alistair Strang from Trends and Targets
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When we ran an analysis on Lloyds Banking Group (LSE:LLOY)three weeks ago, the share price was 55.52p and now, as we enter the downhill slope to the end of the year, it’s impressing everyone at 55.56p.
This growth of 4/100ths of a penny hasn’t really impressed anyone but tends to enforce our feeling that the financial sector is being “parked” until the UK election is over.
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One curious event which has occurred seems to be the arithmetic we associate with GapUp GapDown movements has changed. We’d given criteria indicating potential reversals to an initial 53p but, instead, the lowest the share achieved was 53.3p, causing us to revisit our criteria in case something had changed.
This certainly seems to be the case, making us wonder if the market simply uses this strategy to slow share price movements, when a share price is actually in an uptrend. It creates a situation where explaining our expectations will prove difficult next time we see this sort of thing.
We suspect it shall be best to find something else to do until after the election in a couple of weeks as Lloyds still looks like it has potential to move.
From a Big Picture perspective, it is already trading in a zone where a longer-term 65.75p has become a viable ambition, but even near term, above 56.1p should now promote movement toward an initial 58p with secondary, if bettered, at 59.5p.
If things intend to go pear-shaped, below 52p risks pushing reversal to 49.5p.
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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