easyJet shares could spring a big surprise

A key player in one of the industries worst affected by the Covid pandemic, the budget airline is still in recovery mode, but independent analyst Alistair Strang thinks something could be about to happen. 

We quite cruelly refer to market price gaps at the open of trade as "manipulation". Our reasoning is quite basic, if no-one was able to trade, how else can the market justify the price movement? But if manipulation is your thing, few shares prove quite as fascinating as easyJet (LSE:EZJ), a share where we've been painting little red circles since 2020 on inexplicable price movements.

There are a lot, an awful lot, roughly 10 per year.

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From our perspective it's a nuisance, as software likes data which makes sense. When gaps in the trading value of shares appear, they provoke a degree of confusion and led us to introduce a little piggy bank of gap values against shares. These accumulating values essentially allow for plus or minus parameters in any major price movement.

To be fair, we've as little confidence in this logic proving correct or having any hope the reader will understand the point being made. 

With easyJet, the confusion is strong. We reviewed the share a couple of months ago, promising we'd revisit if the price closed above our 355p target level.

Trading around 390p at time of writing, the share price needs to exceed just 415p to give considerable hope for an ascent to an initial 457p with secondary, if bettered, at a longer term 572p. So far, so good, unless we throw a spanner in the works and take account of manipulation gaps.

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Above our secondary hovers a third level calculation at 793p, a number which visually even looks sane! Our confidence always increases when target values match historic highs or lows. In the case of the 800p level, the share price has tended to pivot above and below for quite a while.

Past performance is not a guide to future performance 

Unfortunately, this is easyJet and we're a little worried at the effort employed to stop the share price from closing above Blue, the downtrend since pre-pandemic 2020.

If this avoidance of the trend proves correct, below 370p risks promoting reversal to an initial 323p with secondary, if broken, down at 258p.

We think easyJet shall offer a surprise and head to 572p next.