Standard Chartered failed to exit the trading range GBp 1285/1360 and is about to break its GBp 1283.5 support.

Regarding company’s fundamentals, we can note major weaknesses. The main point is the downward revision on EPS for 2013 and 2014, respectively at +20% and +15% over the last year.

Technical analysis gives a bearish signal in the short (breakout of the GBp 1283.5 support). The bearish orientation of moving averages confirms this hypothesis. We anticipate a continuation of the correction toward the GBp 1200, corresponding to a swing effect of the current trading range. The breakdown of this level would be a strong sell signal and open up new bearish targets.

A short position may be initiated on the stock once the GBp 1283.5 support is broken. The target price is set at GBp 1200, a potential of 7%. A stop order will be placed above the GBp 1300.