Why I’m worried about Tesco’s share price
16th March 2022 06:50
by Alistair Strang from Trends and Targets
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Its shares have outperformed the FTSE 100 over one year and five years, but something is concerning independent analyst Alistair Strang.
Tesco (LSE:TSCO) is bothering us a little. The share price managed to hit both targets proposed in our report in September last year. What’s happened in the period since is proving a nuisance as despite exceeding our secondary target (291p) the share price is currently falling further than we would expect.
Presently trading at around 278p, the price needs below 264p to justify a frisson of worry, allowing a cycle to an initial 248p and hopeful bounce.
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The real problem comes, should 248p break as our secondary works out at 228p. This secondary presents a major issue, breaking below the pandemic red uptrend line and also breaking slightly below the blue downtrend trend break level. In plain English, it allows a third level drop target down at 192p.
However, despite the gloomy potentials, our alternate scenario allows movement above 283p to apparently trigger price recovery to an initial 292p. If bettered, our longer term secondary calculates at a believable 310p.
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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