Greggs is looking to sustain its share price growth after it reported a better-than-expected increase in sales for like-to-like items from 1% to 3% in the seven weeks since 10 May on a year-on-year basis, despite an overall drop in retail demand. The company says that if the current sales recovery levels are sustained, it would positively impact its financial results for 2021.
The positive forward guidance provided some relief for investors in a problematic pandemic year where reduced customer visits disrupted its business model.
Greggs share price has grown nearly 40% since the year began but has begun to show signs of exhaustion as growth has plateaued in the last seven weeks. Greggs share price is up 0.23% on the day.
Technical Levels to Watch
The Fibonacci extension levels traced from the 11 December 2020 to 16 March 2021 price swing show price challenging the 2595 price mark (78.6% Fibo extension). A break of this area brings the 2668 (88.6% Fibonacci extension) and 2700 (psychological resistance) into focus. In addition, 2750 is a resistance level that merges with the channel’s upper border, reinforcing that resistance area.
‘On the other hand, failure to break beyond 2595 could allow for a pullback that puts the channel’s lower edge under pressure. If this boundary breaks down, 2473 (61.8% Fibo extension level and 27 May and 21 June) and 2387 become additional targets to the south.