Lloyds Bank (LSE:LLOY)
There was a time when our GaGa rule (gap down, gap up) signified a fairly solid change in market intent, one which we could confident predict an outcome. In the case of Lloyds Bank (LLOY), it played this game recently and thus, is heading up to 75p initially.
Even better, secondary calculates at a pretty firm looking 92p!
Regular readers will be aware we are never, ever, this confident with a share from the comedy sector and alas, there is actually a fly in the Lady GaGa ointment.
For this particularly ridiculous set of criteria to hold water, it demands the price actually be moved below, then above, a prior trend. In the case of Lloyds, this was not the case, though there is actually something quite fascinating worth paying some attention to.
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On 21st February 2018, Lloyds Bank’s share price was gapped up above the downtrend from 21st February 2007, the precise moment when it all started going wrong for this share price when it suffered the horrors of trading above 6 quid!
There is an interesting coincidence of dates there and it comes with the implication Lloyds has moved from the “going down” zone to the “awaiting recovery” zone.
For Lloyds, our inclination is to demand the share price actually close above 74p before breathlessly exclaiming it may be alive as, essentially, we really like the assurance of “higher highs” providing a vehicle to reliably lift a shares value.
There has been too many manipulation gaps to make calculating an immediate uptrend a sane prospect but, for now, Lloyds would really need to slide below 62p to give real cause for concern as a trip back toward 55p, perhaps even 50p, becomes immediately viable.
Alistair Strang has led high-profile and “top secret” software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know “how it worked” with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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