Aviva Share Price Tumbles As FTSE 100 Index Turns Negative

Summary:
• Aviva Share Price Forecast: LON: AV chart shows that the shares have been rejected from the 200-day MA which lies at 428p. A reclaim of this level can send it to 500p.

Aviva (LON: AV) share price is having a rough start to the week as the stock dropped 1.18% on Monday. The correction comes after two consecutive weeks of positive price action. Our analysis reveals that the pullback is not surprising at all, as the shares recently retested a major resistance level.

The UK equities showed a mixed price action on the first trading session of the week. The benchmark FTSE 100 index remained positive for the most part of the London session but turned negative during the second half. Shares of major banks had a pullback today after a strong rebound from their March lows.

LON: AV Recovers After Major Banking Crisis

In March 2023, multiple banks in the US collapsed due to the high-interest rates in the country. This was followed by growing concerns about the fate of top Swiss lender Credit Suisse, which the UBS group eventually acquired after government intervention. This situation shook the investor faith in global financial institutions, and the shares of major banks and insurers tanked.

Aviva share price UK also dropped to its fresh YTD low amid the global banking crisis. The shares rebounded after a 17.5% drop but are facing headwinds once again. At the time of writing, the stock of the British insurer is trading at 415p after a rejection of major resistance.

Aviva Share Price Tags 200 MA

The LON: AV chart is a classic example of rejection from a 200-day moving average. The chart clearly shows that the shares recently retested the 200 MA, which lies at 428 on the daily chart. However, the price failed to break above this level which triggered a sell-off. This level also happened to be mid of the trading range that the shares have been retesting for months.

My Aviva share price forecast will remain bearish as long as it remains below the $428p resistance. A break of this level can unlock a huge upside, with the first target being the yearly high of 467p. The second possible target could be the massive psychological level of 500p. However, reclaiming the 428p level is the prerequisite for this move.

In the meantime, I’ll keep sharing updated outlook on LON: AV in my free Telegram group that you’re welcome to join.