Interactive Investor

Have Vodafone shares finally bottomed?

It's been mostly downhill since these shares were trading at a mighty 240p six years ago, but there are signs that large-scale selling may have finally ended. Independent analyst Alistair Strang reveals what his charts say.

27th March 2024 07:42

Alistair Strang from Trends and Targets

The death by 1,000 share price cuts which afflicts Vodafone Group (LSE:VOD) continues to plague the phones giant. Visually it appears the market isn’t overly impressed with the plan to spin off their Vodafone UK mobile phone service with Three UK and, of course, the market regulator has now stuck its oar in with some reasonable questions.

Vodafone, owning and operating networks in 21 countries, along with partnering in an additional 44 countries, make it easy to forget their UK operation is just a single division of the massive company.

Vodafone, despite their long history and international success, have a share price which has failed to impress anyone for some years, and there are signs (weak signs) it may perhaps have bottomed this year.

The first indication for this to be the case shall come if the price trades above 75p as this should trigger a movement to an initial 79p.

Above such a level and things start to become more interesting, calculating with the potential of a future lift to 94p and the potential of a break above the downtrend since 2018.

We think the markets shall regard this as quite a big deal, due to closure above Blue on the chart immediately dumping the share price in a zone where a long-term attraction is seen as coming from 130p.

However, there’s also the risk the deal to merge Vodafone UK and 3 Mobile UK shall be viewed as poisonous. If this is the case, the price needs below 62.5p to risk triggering reversal to an initial 57p with secondary, if broken, at 53p. The proximity of these targets tends to suggest this movement will almost certainly produce a bottom.

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.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

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