FTSE 100
Lloyds’ share price is down heavily this Friday, as fears of a no-deal Brexit transition seized hold of the UK market. The Bank of England (BoE) is already responding to the scenario of the UK’s exit from the EU with no deal in place and has prepared to hold the counter-cyclical capital buffer of UK banks at 0.
Further compounding the bank’s woes are findings from a pay gap report released by the bank. The latest report on the ethnicity pay gap shows that black employees are paid 20% less on average than their colleagues of other ethnicities. While the bank has tried to explain the differential as more of a staffing deficit at the BAME level, the issue of payment equalities based on race continues to plague many companies globally.
Lloyds’ share price is the 3rd biggest loser on the FTSE 100 this Friday, and it is down 5.61% at the moment.
Yesterday’s breakdown of the triangle converted that pattern into a topping pattern and invalidated the expected bullish break. The breakdown move has taken out the 35.97 support level and violated the 34.77 price level as well.
If Lloyds’ share price ends the week around these levels, the break of 34.77 is confirmed, opening the door for the move towards the 32.95 support target, which already seems to be at risk from the stock’s heavy offering on the day.
Bulls may see some recourse if the price can bounce at 32.95 or if the breakdown of 34.77 is not confirmed. This would allow a retest of 35.97, with 37.02 and 38.26 forming additional upside targets. These targets may also serve as rally points for those who hold a bearish outlook as new areas to initiate shorts.
The Brexit trade deal situation remains the key driver of price action. Sunday will provide more clarity on the situation and could dictate how Lloyds share price action responds.
