Lloyds Share Price Has More Upside, Chart Pattern Shows

Summary:
• The Lloyds share price has been in a relatively tight range in the past few weeks. The stock is trading at about 49.23p

The Lloyds share price has been in a relatively tight range in the past few weeks. The stock is trading at about 49.23p, which is slightly below the year-to-date high of 51.47p. It has jumped by more than 100% from its lowest level in 2020.

Key UK economic data ahead

The Lloyds share price has had a relatively strong year, helped by the strong UK economic recovery. The housing market has been relatively strong. Indeed, home prices have surged by more than 21,000 pounds from last year.

The country’s unemployment rate has dropped while retail sales have been relatively strong in the past few months. As a result, the company has been able to shift most of the funds it placed into provisions last year into its profits.

Lloyds Bank has also taken more actions to boost its business. For example, it acquired Embark, a company that has more than 410k customers in the UK. It brought more than 35 billion pounds of assets under administration.

Another key catalyst for Lloyds share price has been the potential for rate hikes by the Bank of England (BOE). While the BOE left interest rates and QE policies unchanged this month, it hinted that the next action will be to hike rates.

Therefore, the stock will be in the spotlight this week as investors reflect on the data dump from the UK. On Tuesday, the UK will publish the latest jobs numbers that will likely show that the unemployment rate dropped in September. These numbers will be followed by inflation data that will come out on Wednesday and retail sales that will come out on Thursday.

Lloyds share price forecast

On the chart below, we see that the LLOY share price has been in a strong bullish trend in the past few months. A closer look shows that the stock has formed a cup and handle pattern. Indeed, the current pullback is part of the stock’s handle formation. It is also slightly above the ascending trendline shown in purple. 

Therefore, the Lloyds share price will likely resume a bullish trend in the coming days or weeks. In my view, there is a likelihood that it will rise to about 60p in the coming months.