Lloyds’ share price had a mild appreciation today, but gains have been capped on the dovish Bank of England decision and statement.
This Thursday, the BoE left its policy rate and asset purchase facility size unchanged but hinted at what it called an “unusually uncertain” outlook for the UK economy.
Following the decision by the BoE to ease dividend payment bans for UK banks, there had been expectations that the BoE could send rates into negative territory, but that did not happen today. Still, UK bank stocks appear pressured by the lack of progress at the Brexit trade talks.
Lloyds share price has pared some of yesterday’s losses, following today’s bounce on the 35.97 support level. The daily candle found resistance at 37.02 but is off intraday highs. Still, Lloyds’ share price is up 1.16% and looks set to retest the 37.02 resistance. A break of this level opens the pathway to 38.26, with 39.53 and 40.66 constituting upside targets in the near-term. The latter two targets would be of benefit to buyers who aim to treat the evolving pattern as a bullish flag, and they may even pursue a measured move towards 41.55.
On the flip side, a rejection at 37.02, followed by a breakdown of 35.97 allows sellers to push Lloyds’ share price towards 34.77. However, a lower low than 32.10 could set off a resumption of the downtrend, especially as a rejection at 37.02 would mark a 3rd successive lower high. This move would also invalidate the bullish flag.
