The Boohoo share price is down 3.86% as of writing, as the UK online clothing retailer makes a shaky start to the week. This decline follows four days of gains as the stock aimed to recover from the recent decline that took it below its previously traded range.
The negative sentiment surrounding the Boohoo share price is closely related to the lowering of forecasts on the stock by stockbroker Panmure Gordon. A statement outlining the brokerage’s outlook said it was “reducing sales and profit forecasts in line with the company’s guidance by nearly 20%…” Panmure Gordon noted that Boohoo was uncertain about growing its core UK business.
Despite the negative outlook, Boohoo is stepping up efforts to increase its footprint in the NFT space. It is partnering with four female artists to create a new, inclusive Avatar collection. Boohoo has tapped Amy Kilner, Aoife OO’Dwyer, Reem El and Shar.eth to increase the female presence on the metaverse using unique fashion pieces from Boohoo’s product collection.
Technically speaking, the breakdown of the rectangle pattern was followed by a return move on 29 April. The breakdown was cemented on 4 May when the Boohoo share price dipped 12.40% on the back of its downbeat full-year 2021 earnings report and pessimistic outlook for the full year.
Boohoo Share Price Outlook
The intraday decline looks set to test the support at the 76.12 price mark (24 February low and 5 May high). If this support holds firm, a bounce could put the Boohoo share price activity on the path toward the 85.64 resistance. This is the former floor of the completed rectangle and the site of previous lows seen on 9 February and 11 March. A further advance brings the rectangle’s ceiling at 96.86 (22 March and 6 April highs). 109.10 (1 February high) and 128.50 (29 December 2021 high) are additional barriers to the north which become available if the bulls clear the 96.86 price mark.
On the other hand, the 63.42 price mark (7 March low) becomes the next target if the bears degrade the support at 76.12. Below this level, additional southbound targets are seen at 52.30 (13 June/27 June 2016) and at 45.18 (3 May 2016 low). 39.12 is an extreme price barrier to the south and only becomes viable on extended price deterioration.