The Asos share price has been in a strong rally recently, and this week, it moved above the important resistance level at 5,842p, which was the highest level since April 2018. Asos stock is trading at 5,918, which is slightly below the important psychological level of 6,000p.
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What happened: Asos is a fast-growing UK fashion e-commerce website that sells more than 85,000 products. The company was a key beneficiary of the coronavirus pandemic as more people moved to buy products online. It has also benefited by acquiring top UK brands like Topman, Topshop, and Miss Selfridge in bankruptcy.
Also, the firm is expanding its fulfillment facilities in countries like the US and Germany. Its revenue also jumped by 23% in the final quarter of the year. Further, as Boohoo remains being under pressure, more shoppers could turn to Asos. Indeed, analysts at Berenberg and Societe Generale have sounded optimistic about the company. They believe that people will still keep shopping online even after the pandemic ends.
Asos share price forecast
The four-hour chart shows that the Asos share price has been in a strong rally recently. It has risen by 17% from the lowest level this month after it reported mixed earnings. The stock has also moved above the previous resistance level at 5,842p and risen above the 15-day and 25-day moving averages.
Therefore, while a pullback is possible, the overall trend for the stock is bullish. This means that it could keep rising as bulls attempt to move above the resistance level at 6,000p. However, a drop below the now support at 5,842p will invalidate this prediction.