Standard Bank (stan) and HSBC (hsba) continue in Uptrend and so hint at higher prices to come whilst Barclays (barc) is suffering a 20% price fall from its October high and is not presenting such a promising future at the moment but it is Royal Bank of Scotland (rbs) and Lloyds (lloy) that are the real lemons – leaving a bitter aftertaste.
Both RBS and Lloyds remain in Downtrend; the same downtrend that started in July 2007 and identified and alerted by ShareHunter at the time. With RBS at 34p the possibility that it may test again its all-time-low at 10p (Jan ‘09) becomes a probability with the downtrend remaining in force.
For Lloyds the position is even worse. Those investors who bought (against the trend) when the price moved up in March and again in August to the plateau at the 110p area are now nursing another severe financial headache with last week’s collapse back down to the 55p area.That collapse represents an overnight 50% loss of the capital those buyers invested.
But it could all have been so easily avoided. At ShareHunter we have two rules, given to members, which are designed to avoid such ‘avoidable’ losses – 1) Never trade contrary to the dominant trend (i.e. don’t buy in a downtrend) and 2) Never (ever!) try to guess the bottom (of a stock or of the market). More money is lost by investors trying to guess a bottom price of a stock or of the market than for any other reason.
In fact, perhaps the most expensive words in the English language are …”it can’t go any lower”!! It is not just the Panto season that let’s us answer …”Oh yes it can”!.
At ShareHunter we are always available to provide a free opinion of a stock before you buy.
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