The Cineworld share price activity has started to contract into a triangle consolidation pattern, following its spectacular plunge on 15 December. The Cineworld share price nosedived 39.4% on 15 December after being asked to pay £720 million in damages to Cineplex, who had sued the cinema chain over a contractual breach in the failed takeover process. Cineworld had expressed its intention to appeal the decision. However, the stock was downgraded from a Buy to Hold by Jeffries, with a price target of 35p.
However, there is some hope for Cineworld’s investors as the latest Spiderman movie, No Way Home, raked in $600million in its opening weekend to become the 3rd largest global box office intake. The company would need to see its movie releases taking in such revenues if it is to work its way back from the pandemic-induced revenue losses and the potential damage from the Canadian court ruling.
Cineworld Share Price Outlook
The 15 December decline and subsequent triangle consolidation suggest a downside continuation of the price activity. This move needs to break down the triangle and the 31.72 support level, aiming for 23.49 and the 5 October 2020 low at 15.64.
On the flip side, a bounce on the 31.72 support breaks the triangle to the upside, targeting 39.95 in the first instance. If the bulls successfully uncap this resistance barrier, 44.93 becomes the next available price mark. 52.65 and 56.01 are additional upside targets that are presently out of reach.