Why Lloyds Bank shares could soon hit an 8-month high

TL;DR

Despite negative sentiment surrounding banks, rising interest rates and improving mortgage loan margins suggest a positive outlook for Lloyd's.

Transcript

hello it's John Burford with chart of the week for Monday the 12th of September and I'm covering my old friend Lloyd's today um yes it's been through the mill um in recent years um but now let's con let's focus on where we are today as you know there's been a lot of talk about a recession coming even a depression and so that has put sentiment bulli... Read More

Key Insights

• 🏦 Negative sentiment towards banks, including Lloyd's, exists due to recession and depression concerns.
• 😮 Rising interest rates and bond yields provide a positive background for banks.
• 💹 The chart analysis reveals significant support and momentum divergence, suggesting a buying opportunity.
• 🫥 Strong tram lines and the power of support and resistance levels are evident in the chart analysis.
• 🚄 The analysis indicates a strong bull phase for Lloyd's, with a target of 50 pence and potential to reach the previous high of 56 pence.
• 🙃 Short-term outlook is bullish for Lloyd's, with potential for further upside.
• 🤩 Interest rates and bond yields are key factors to watch for in determining the future performance of banks.

Questions & Answers

Q: What factors have affected sentiment towards banks, including Lloyd's?

Sentiment towards banks, including Lloyd's, has been impacted by talks of a coming recession or depression. This has caused bullish sentiment to be low.

Q: How have interest rates and bond yields played a role in improving margins for mortgage loans?

Low interest rates in the past kept mortgage loan margins tight, even with high house prices. However, rising interest rates and bond yields now indicate an improvement in margins, which benefits banks such as Lloyd's.

Q: What key features does the chart analysis reveal?

The chart analysis shows a region of support pre-corona crash, with a notable momentum divergence suggesting a buying opportunity. The analysis also suggests the completion of a second wave or B wave, with potential for a rally.

Q: What is the target for Lloyd's according to the analysis?

The analysis indicates a target of 50 pence, with potential to reach the previous high of 56 pence. Further movement will depend on wave patterns.

Summary & Key Takeaways

• Lloyd's has faced challenges in recent years, but current market conditions indicate potential for growth.

• Bond yields and interest rates are rising, which is beneficial for banks.

• The chart analysis shows signs of a strong bull phase for Lloyd's, with a target of 50 pence and potentially higher.