The Persimmon share price continues the stunted recovery from last month’s first-half trading update, reclaiming the 200-day moving average yesterday. However, the share price has a love/hate relationship with the long term indicator and has spent the last two months jockeying for direction on either side of it.
The bump that FTSE-listed housebuilder Persimmon plc received from pent-up demand following the covid lockdowns has disappeared over the last couple of months. After setting a post-pandemic high of 3,272p in June, the shares have been on the slide and reached a multi-month low in August. The price initially came under pressure when the H1 earnings report, highlighted growing materials and labour costs. However, the Persimmon share price reversed from the 2,767p six-month low and went on to gain 7% by the end of the month.
The daily chart shows the share price has been trading lower in a wide trading band since April. Also, notably, much of that time, it has danced between the major moving averages.
The Persimmon share price of 2,894p is marginally higher than the important 200 DMA at 2,887p, although not by much. If the price manages to drag itself higher and out of danger, the next focus is the 50 and 100 DMA’s at 2,929p and 2,948p. Successful clearance on a closing basis should set the price up for further gains, targeting the top-end of the descending channel at 3,000p.
However, until the 200 DMA is cleared, the descending remains in charge. And on that basis, if the share price extends below 2,887p the path of least resistance will be lower.
Persimmon Share Price
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