SDL : Anticipation of a bearish reversal
By Bastien Chabasseuil
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
GBX 344.35 | GBX 0 | GBX 362.4 | +100% |
The study of the financial figures underlines real difficulties to make profits. The strong downward revisions on EPS implies that we prefer a decreasing reversal on the security in the short term.
Graphically, the stock went through a period of rebound during the last sessions towards the GBp 357.5 medium-term resistance. The share should consolidate near this area. It could act as a stopping point of the upward movement. This scenario suggests a return to the GBp 300 support area which will be a bearish objective.
The upside seems limited as shown by fundamentals and technical configuration. In contact with the GBp 357.5 resistance, a movement of consolidation could return the stock towards the GBp 300 mid-term support. As a result, the most aggressive investors could take a short position near GBp 357.5 but they need to set a stop-loss above this resistance in of breakout.