The Lloyds share price has opened with a huge gap up in today’s trading session and is currently up by 3.5 per cent. Today’s surge in price has been an extension of a 3-day bullish streak which has resulted in the company value rising by 5 per cent.
However, despite today’s surge in price and the bullish trend we have seen in the past two sessions, Lloyds share price has struggled in the markets for the past few months. In fact, the company has traded within the demand and supply zones of 41p and 46p, respectively, since April.
The current rising cost of living in the UK has been part of the reason we have continued to see Lloyds share price performing dismally in the markets. The latest data shows that the consumer price index in the UK stands at 10 per cent, with research from Goldman Sachs showing a likelihood that the inflation rate may hit 22 per cent by next year. Lloyds, being the UK’s largest mortgage lender, therefore carries a risk of seeing a huge chunk of their clients defaulting on their debts. Despite the current market conditions being highly positive for the property market, the fear of defaults has resulted in the number of buyers and sellers of Lloyds share price cancelling each other and creating a horizontal market with a narrow trading range.
My Lloyds share price prediction expects the current sideways trend to continue. Looking at the chart below, we can see that since April, the company has traded within the demand and supply Zones of 41p and 46p, respectively.
With the current rate of inflation likely to rise, there is a high likelihood of the company’s share price continuing to struggle in the long term. However, should the prices fall below the demand level of 41, or rise above the 46 supply zone, then my horizontal trend analysis will be invalidated.
This post was last modified on %s = human-readable time difference 12:18