Here's where Lloyds may bottom

Lloyds has a pretty amazing downtrend line since 1999 which is currently at 89.347p. It's one of the "fruitcake" elements visible on our "master" chart, which we generally utterly ignore until such time as a calculated target level starts to interfere with a trend.

Essentially, if we can draw the line, it's pretty sure other people can and therefore we have a visual indication if a target is silly or viable. In this instance, over the period since the banks imploded, Lloyds has managed to waffle around in this region on rather a few occasions - but, should it now achieve such a stonking level, we'd tend to expect some proper growth to occur thereafter. Breaking a 17-year trend line would be seen as significant by the market.

However, this optimistic carrot risks rotting in the near future.

When we look at movements since our country make a break for freedom, there is a heck of an argument favouring Lloyds hitting a bottom of 48.5p on the current movement cycle. This would tend to suggest an impact against 'red' on the chart, the final adjusted uptrend since 2011 (currently 46.396p).

We would experience extreme collywobbles if anything now permitted Lloyds to close below 'red', as it would confirm a region where weakness to an initial 33p makes sense, with secondary a probably bouncy bottom at 22.5p.

In fairness, the price has just about ticked every box for a seriously nasty drop and we fear we're just witnessing struggles against fate.

For Lloyds to manage a Houdini and escape its doom, the share needs trade above 58.25p, as this should apparently give strength for 59.6p.

The important thing about the 59.6p aspiration is that, if it's bettered, there is a chance the share price has actually bottomed. Our secondary above 59.6p is a more useful 70.6p and if this were to be exceeded, we shall be convinced bottom is "in".

Unfortunately, for now, it appears Lloyds is stuffed. Hopefully we're weaving too much cloth from just three days of trading since the euroshambles. We are certainly starting to suspect the markets did not like 'Leave', but there's something a bit odd. Had the UK voted 'Remain', we still had a pretty firm argument favouring Lloyds heading down to 54p.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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.