Barclays’ share price dropped by more than 3%, making it the worst-performing bank in the FTSE 100. Other banks, including Royal Bank of Scotland, HSBC, and Lloyds, also saw declines of 2.89%, 2.31%, and 2.36%, respectively. Meanwhile, the FTSE 100 index fell by over 1.30%, becoming one of the weakest indices in Europe.

Barclays shares have been on an upward trend since reaching 72 pence in March. Since then, the stock has climbed to 128 pence, marking a 77% increase. Other banks like Lloyds and HSBC have followed similar trends, largely due to positive overall stock market performance and signs that the global economic recovery may not be as bad as initially feared.

However, Barclays faces a significant challenge with Brexit. Last week, the fourth round of talks between the UK and the EU ended without a deal, increasing the likelihood of a no-deal Brexit unless Prime Minister Boris Johnson requests an extension of the transition period by the end of the month. All indications suggest that he will not seek this extension.

This situation poses risks for Barclays. Earlier this month, the Bank of England urged banks to prepare for such an outcome, with Governor Andrew Bailey stressing the importance of preparing the UK financial system for all potential risks.

On a positive note, Barclays benefits from its Fixed Income Commodities and Currencies (FICC) division, unlike Lloyds, which focuses primarily on consumer and business lending. In the most recent quarter, Barclays’ income rose by 20%, driven by its Corporate and Investment Bank (CIB) division. FICC revenue surged by 106% to £1.86 billion. There are signs this division will continue to perform well, as indicated by Deutsche Bank’s CEO, who noted accelerating momentum in their own FICC business.

From a technical perspective, Barclays’ share price hit resistance at the 50% Fibonacci retracement level of 134 pence yesterday. Despite this, the stock remains above the 50-day and 100-day exponential moving averages, suggesting the share price could continue to pull back as bears target the 38.2% Fibonacci retracement level at 118 pence.

On the other hand, a move above yesterday’s high of 134 pence would invalidate this bearish trend, potentially pushing the stock higher as bulls aim for the 61.8% retracement level near 150 pence.