Does GSK have a pill to revive its share price?
24th May 2023 07:31
by Alistair Strang from Trends and Targets
One of the country's biggest companies is under Alistair Strang's microscope today, and the independent analyst has high hopes for future recovery following last summer's slump on Zantac litigation fears.
As it has been nearly a year since our previous GSK (LSE:GSK) review, we’d hoped for something approaching useful share price behaviour, but instead the company has managed a level of stability usually seen in the banking sector.
This, of course, is a polite way of saying “nothing much happening!” which is a surprise. Glancing at their Wiki page, they could inspire an entire franchise of movies capable of challenging ‘Pirates of the Caribbean’ or ‘Jason Bourne’.
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However, speaking as someone whose daily diet includes at least three of their pharmaceutical products, GSK is obviously a brilliant, innovative, company and one which we should support.
If GSK's share price intends to cause real trouble in the future, presently below 1,330p looks like firing the first warning shot, risking the price sinking below Red on the chart below and finding its way down to an initial 1,260p, perhaps with a short-lived bounce.
In such a scenario, we suspect 1,260 shall break, with the share price eventually finding a bottom by 1,144p and hopefully a proper rebound. There’s a major problem at the 1,144 level as any break below calculates with the potential of slippage to 770p eventually.
Currently, absolutely nothing suggests this is a threat.
We shall be more interested if the share price manages to find its way above 1,527p, breaking through the immediate Blue downtrend and giving some hope for future recovery. Such a movement works out with the potential ability to climb to an initial 1,520p with secondary, if beaten, at 1,717p. Above such a level will require us to again view the tea leaves, thanks to potentials which suggest a new all-time high is awaiting in the distant future.
Source: Trends and Targets. Past performance is not a guide to future performance.
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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