BT Share Price Forecast: Is Moody’s Upgrade a Gamechanger?

The BT share price is looking to make it two out of two winning sessions after the stock saw its outlook lifted by credit rating agency Moody. The BT share price added 458% on Monday and has followed it up with a gain of 0.29% on Tuesday, thus recovering the high previously seen on 13 June.

At a time the stock found itself depressed by the impending strike action by the Communications Workers Union, shares of BT Group got a lift as Moody’s re-affirmed the Baa2 senior unsecured long-term issuer ratings. In addition, the BT share price had its outlook upgraded from negative to stable. 

The upgrade came on the back of the expected recovery in the EBITDA metric when the fiscal year ends on 31 March 2023. This recovery is expected to come amid price increases and sustained interest and uptake of its fibre products at its Openreach division. The situation pleased investors, allowing them to shake off any hangover from last week’s bearish performance brought on by the ongoing labour dispute with CWU. 

The company is also waiting to see if the French telecom businessman Patrick Drahi will make a move for BT Group once the six-month moratorium on the deal expires today. Drahi is an existing shareholder who holds up to 18% equity.

BT Share Price Forecast

The price action has met resistance at the 191.15 price mark (7 April, 24 May and 31 May 2022 highs). It would require a break of this level to send the stock toward 193.90, where the 12 April high is located. Above this level, additional targets to the north include 200.85 and 206.65, the site of a multi-year high seen on 17 June 2021.

On the flip side, the rejection at the 191.15 resistance has formed a pinbar candle. An extension of this rejection requires the formation of a bearish outside day candle, targeting a breakdown of 183.85 (1 April and 16 June high) to confirm the corrective move. Attainment of this breakdown clears the pathway toward the 180.60 pivot (18 May 2022 low), leaving the 175.55 and 170.85 (8 December 2021 low) support levels as the additional southbound targets.

BT: Daily Chart