Lloyds share price declined 3.7% from its last weekly close as the British bank reported a 25% reduction in its third-quarter earnings. A glance at its daily chart shows the bull attempted to break above the $41.3 key level but failed to do so. At the time of writing, the shares of the British bank are changing hands at 40.3p and have shaved 2% from its share value.
The FTSE 100 extended its losses on Friday after the Middle East conflict remained a concern. At the start of the US session, it stood at 7,292 points. The recent correction in bond yields helped lift the US stock market sentiment but the UK equities remain in a tailspin.
The UK bank stocks suffered today as NatWest decreased its yearly net-interest margin guidance. Earlier this week, Barclays also downgraded its net-interest margin guidance as the banking sector faces intense scrutiny from regulatory authorities regarding mortgage and savings products.
The Lloyds share price shrugged off the recently reported slightly better than expected earnings. The bank reported a £1.86 billion in pretax profit, slightly above consensus of £1.82 billion. Additionally, Lloyds also maintained its net interest margin unlike two of its rivals. Nevertheless, Lloyds share price now sits 26.1% below its yearly high.
Lloyds Share Price Forecast
LON: LLOY recently retested the 41p support level which I predicted in my previous forecast. As a result. the chart below also shows the shares gaining acceptance below 41p after retesting the key level for resistance.
Since the price has confirmed its break below 41p, a retest of the 38.5 support level seems very probable. Therefore, the only way to flip the Lloyds share price forecast bullish on a higher timeframe is to reclaim the 41p key level. This seems unlikely to occur anytime soon.