The Lloyds share price eyes 50p on improving technical outlook

The Lloyds share price staged a strong recovery last week, jumping 5% and clearing several key resistance levels in the process. Lloyds (LON: LLOY) finished Friday at 48.82p, its highest close in almost two months, bringing the gains from the September low to over 13%. As a result, Lloyds is breaking out to the upside and on track for a run at the June high.

Lloyds has performed remarkably well of late despite continued economic headwinds. At the start of last month, the share price was under considerable pressure as the Evergrande default spilt over into UK equities. On the 15th, LLOY was changing hands at a four-month low of 41.35p and below the significant 200-day moving average. However, concerns that the Evergrande collapse would spark widespread contagion have eased somewhat in the last couple of weeks. Furthermore, the recent debt-ceiling agreement has also lifted some weight from risk assets. Also, Friday’s disastrous Non-Farm Payrolls raises questions over the November taper. As a result, global stock indices have recovered from the weakness of September, lifting banking stocks higher.

LlOY Price forecast

The daily chart shows the Lloyds share price climbed out of its downtrend in late September. Furthermore, after breaking out, the price bounced after a successful test of the trend at 44.60p. Subsequently, the rally has lifted Lloyds above the 50-day moving average at 44.94p and the 100-day at 46.13p.

As long as the Lloyds share price maintains the trend breakout, it should extend higher towards the 50.56p high set in June. Therefore, the outlook is bullish above 44.60p with a 50.56 price target. However, if the price falls back into the downtrend, it will indicate a bearish reversal, invalidating the bullish view.

Lloyds Share Price Chart (Daily)

lloyds share price

For more market insights, follow Elliott on Twitter.