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Barclays Share Price Stumbles Despite a Strong Finance Report

In the early hours of today’s trading session, the Barclays share price soared amid reports that its profits were projected to reach £2 billion. However, the bullish trend has not been able to keep up, and as the trading session nears its close, its value is gone down, and now trading below its opening price by almost 2 per cent. 

The reports in the early morning hours saw Barclays becoming the second big bank in the UK this week to outperform its forecast. Part of the reason for the recent price growth has been attributed to the increase in borrowing costs and bond trading at a time when the UK’s market has been in a meltdown. 

Most experts were expecting the company to reveal a slight dip in earnings. However, its pre-tax profits beat the market forecast by about £200 million, recording an increase of 6 per cent. Most of the profits came as a result of rising borrowing costs, which saw its interest income surging by almost 60 per cent to £3 billion for the quarter ending in September.

These borrowing costs were a direct result of the Bank of England raising interest rates from all-time lows of 0.1 per cent last year to the current 2.2 per cent to help address the inflation rate in the county, which currently stands at 10.1 per cent. 

Barclays Share Price Forecast

The daily chart below shows, despite today’s 1 per cent price drop, the company has been in an aggressive bullish push since October 14. The chart also shows that, before today, Barclays was in a four consecutive day bullish run. 

Therefore, the recent price action shows a recovering company in an upward trajectory. I expect the bullish trend to continue for the next few trading sessions, and there is a high likelihood that we might see prices trading above the 160p price level in the coming days. However, a trade below the 145p demand level will invalidate my analysis.

Barclays Daily Chart