The Barclays share price is struggling ahead of the latest BOE interest rate decision. The bank’s shares have dropped by almost 10% from their year-to-date high of 190p to the current 172p. It has also lagged other FTSE 100 banks like NatWest and Lloyds.
Barclays news. The biggest catalyst for Barclays stock this week will be the BOE interest rate decision that will come out tomorrow. This decision will be important because it will send a signal about what to expect as the UK economy recovers.
A relatively hawkish BOE will be positive for Barclays because it will send a signal that the bank will start tightening soon. Historically, banks tend to do well in a high-interest rate environment. This is also notable because the UK is one of the bank’s biggest market, where it dominates the credit card industry. Barclays is also expected to benefit from the recent volatility in the stock market globally. Indeed, in the most recent quarter, Barclays recorded a strong growth of its FICC business.
The four-hour chart shows that the BARC share price fund a strong resistance at the 190p level. The shares seem to have formed a double-top pattern whose neckline was at around 170p. Also, the shares have moved below the 25-day and 50-day moving averages. It has also struggled moving below the 23.6% Fibonacci retracement level.
Therefore, the shares will likely resume the downward trend if bears manage to move below the 23.6% retracement level at 167p. A drop below this level will bring the 38.2% retracement level at 152p into view. However, a move above the important resistance level at 180p will invalidate the bearish view.
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