Momentum continues following the breakout, but will the earnings dampen investor sentiment?

A key player for the UK tomorrow for the banking/financial sector,, Lloyds bank is expected to release its profits and forward guidance. Currently, the bank’s shares are floating on the market for around 59p a share. Shares of Lloyds are up around 25% YTD having recently broken towards the upside following a rally that began in February. The breakout occurred at the start of this month following a handful of weeks of battling with long-term resistance. This breakout has created some optimism amongst investors who have extended their long exposure on the stock, with Lloyds having a 10/10 rating from analysts for the next 12 months. We can see that the next point of resistance technically sits along the upper trendline, 69p, the high of December 2019. A move from the current level to 69p implies an upside of almost 17%. However, we can see that the stock is starting to look somewhat overbought when glancing over at the indicators. The MACD is at its highest point since 2021 and the RSI has entered overbought territory as it reads 72. Therefore, a pullback in the short term may be forthcoming alongside the looming earnings. The primary support in focus is the previous breakout point, which has flipped from resistance to now support (55p).