The Lloyds share price is not up for trading, as are all UK stocks this Monday, as the United Kingdom shuts down for the state funeral of Queen Elizabeth II. As such, traders will benefit from a look at last week’s price action and use the information to take a position ahead of Thursday’s Bank of England interest rate decision.
InvestingCube's S&R Levels
Not in Sell Zone
The stock ended last week on a high, closing out Friday’s trading at 0.39% to the good. This positive run for Lloyds share price is coming fresh from the market expectation that the Bank of England would raise rates again, putting UK banking stocks in good stead to extend earnings from fixed income investments. This outlook appears to have overcome the sentiment around the news of the Lloyds Banking Group being hit with fraudulent loans under the COVID-19 recovery scheme.
The Lloyds share price has several things going for it. Consensus forecasts show that expectations for losses remain below those experienced during the worst of the pandemic. Credit card borrowing continues to rise at a rate of 13% annually. Spending by wealthier households is also up 300% year on year. Add these to the expected benefits from a BoE rate hike, and we could have a stock that outperforms others in an equity market that is traditionally averse to rate hikes.
Lloyds Share Price Forecast
The rejection of Friday’s candle at the 47.805 resistance makes this barrier the price to beat for the bulls if the advance is to continue. 49.515 becomes the next upside target if the bulls breach this barrier. The 50.510 resistance located at the 29 October 2021/22 March 2022 highs forms the next target in line if the advance continues.
Additional price targets to the north are found at 52.095 (18 February high) and the 54.00 price mark, formed by the 4/11 February 2022 highs. On the other hand, a corrective decline from Friday’s rejection at 47.805 initially targets 46.285 (28 July and 17 August highs).
A deepening of this correction brings 44.99 into the mix, being the site of 25 April and 9 August lows. 43.16 forms the next target to the south if the bears break down this pivot, with 42.045 also serving as an additional harvest point for the bears, being the location of the 12 May and 18 July prior lows.