EURGBP
Lloyds share price continues on the downward trajectory after the UK government sold off most of its shareholdings in the bank. However, this could be viewed as a form of re-balancing process, as the bank works to modernize its operations via the deployment of enhanced technology.
The bank has announced that will be deploying an enterprise solution from Microsoft which will enable it to create a digital workspace, as part of a multi-billion-pound digital transformation process.
This move is the latest in the bank’s three-billion-pound digital transformation plan, which saw the bank also create a tech hub in Edinburgh, Scotland last year to enhance the pool of tech talent available to serve the bank and its customers.
Read our Best Trading Ideas for 2020.
Lloyds share price hit our first downside target of 58.57. I identified this setup in my trade analysis of this stock on January 6, pointing out 58.57 as a potential area of support. This price level finds further strength as a support level from the intersection of the horizontal support line by a rising trendline which cuts across the weekly lows of September 9 to date. Therefore, Lloyds share price activity has to break this level to the downside by a 3% penetration to be able to target the next support level at 56.10. The daily chart may reveal repeated tests of this area before any breakdown of this level comes through.
On the flip side, if price fails to break the support, then we may see a bounce from this price level which could target 61.87, where the symmetrical triangle’s border comes into play in a support-resistance flip. 63.97 and 65.74 are other resistance areas in the picture, which could come into play if Lloyds sees a resurgence in its share price beyond 61.87.