The Rolls-Royce share price is doing relatively well as investors remain optimistic that the global aviation industry will have a strong rebound. The RR share price is trading at 143p, which is about 10% above the lowest level in October.
Transatlantic flights resume
Rolls-Royce Holdings is a leading manufacturer of aircraft engines. Its civil aviation business accounts for more than 50% of its total revenue. Its other businesses are in marine engines and in defence, where it manufactures engines for the military. The company also manufactures products for the power sector.
The Rolls-Royce share price has done well in the past few months and has jumped by more than 65% from the lowest level in July. There are several reasons for this trend. First, the company is expected to benefit from the recently announced deal to manufacture nuclear-powered submarines for the Australian government.
Second, the company recently won a major contract by the American government. The firm will manufacture the country’s engines for the B47 program. The deal is worth billions of dollars.
Third, Rolls-Royce recently partnered with the Qatar government in a bid to manufacture clean energy solutions. The 20-year deal will lead to billions of dollars in revenue.
Meanwhile, the RR share price is soaring as investors react to the reopening of the transatlantic route. This is an important route for the company and its customers like British Airways, KLM, and Lufthansa. As the region reopens, it will lead to more flight hours, which will lead to more income for the company.
Rolls-Royce share price forecast
The RR share price is trading at 143p, which is about 10% above the lowest level in October. It has also moved above the descending trendline that is shown in black. At the same time, it is trading above the 25-day and 50-day moving averages, which is a bullish sign. The Relative Strength Index (RSI) has also been rising.
Therefore, the path of the least resistance for the Rolls-Royce share price is in the upside, with the next key level to watch being at the key resistance at 160p. On the flip side, a drop below 130p will invalidate the bullish view.
