Barclays’ share price has pulled back in recent days as the company outlined plans to reduce operating costs. The stock reached a high of 156p, its highest since September, and has risen more than 16% from its lowest point this year. It has outperformed other banks, with the KBE ETF down over 30% year-to-date.

Barclays is navigating a mixed business environment amid rising interest rates. On one hand, the bank’s net interest income has surged thanks to higher global interest rates. In the third quarter, net interest income increased from £1.3 billion in 2021 to over £1.5 billion this year. For the nine months leading up to September, net interest income exceeded £4 billion.

On the other hand, the investment banking division has struggled as deal activity has slowed. Still, in the third quarter, other revenue grew from £335 million to £355 million, largely due to its trading division. For the first nine months of the year, trading income soared to over £6.5 billion.

In response to these challenges, Barclays announced it would lay off 200 employees from its banking and trading desks this week, aiming to cut costs as investment banking activity slows. Equity issuance has plummeted by 78% this year, while debt issuance has fallen sharply as central banks raise interest rates.

Barclays also faces increasing delinquencies as interest rates rise and recession risks grow in its key markets.

The four-hour chart shows that Barclays’ share price has been in a strong bullish rebound over the past few weeks. The stock has formed an ascending channel and moved above the 50-day moving average, while the MACD has risen above the neutral level. It is currently at the 50% Fibonacci retracement level.

Given this, the stock is likely to continue rising, with bulls targeting the next key resistance at 160p, which corresponds to the 61.8% retracement level. This outlook aligns with my recent forecast for Barclays’ stock.