The Barclays share price has continued the correction from recent highs with a 1.06% dip this Tuesday. This move follows the filing of a lawsuit from aggrieved shareholders in the US against the bank, claiming it made “false and misleading” claims that forced a sale of structured, exchange-traded notes.
A Reuters report said two corporate shareholders, pension plans based in the US, are blaming the bank for a drop in the share price of Barclays ADR by failing to disclose that the structured notes in question were overissued, exceeding the regulator-approved amount by more than $17.6 billion.
The lawsuit also claims the bank overstated profits and underreported its expenses for litigations and conduct. According to the Reuters report, Barclays is said to have set aside nearly $1.67 billion to cater to the repurchase of the overissued amount from investors.
The Barclays share price is also taking a hit as banks pull mortgage products due to the plummeting Pound. Ten banks are said to be pulling mortgage deals after the unprecedented tax cuts announced by UK Chancellor of the Exchequer Akwasi Kwarteng triggered a selling run on the currency.
Barclays Share Price Forecast
The 23 September 2022 drop broke down the ascending trendline and opened the door for a push to the south. The rejection of price action at the 161.62 resistance level has triggered a push to the south, targeting the 26 September 2022 low at 156.92. If the bulls fail to defend this support, the 151.12 support (29 March and 19 May 2022 lows) enters the mix as the next target to the south. 147.48 (13 May 2022 and 5 July 2022 low).
The 140.80 support forms an additional harvest point for the bears on further price deterioration. On the other hand, a break of the 161.62 resistance allows the bulls to push toward the 167.86 resistance (1 July low and 9/30 August 2022 highs).
If this new barrier is breached, the bulls can push toward the 173.60 resistance that has capped price action since April 2022. The additional harvest points to the north are 186.14 (13 August and 16 December 2021 highs) and 190.34 (4 January and 18 February 2022 low).
Barclays: Daily Chart
