The IAG share price has gained 3.66% on the day as sellers exited their positions at the 110.26 support following the completion of the bearish flag pattern. The IAG share price has faced tremendous pressure in recent weeks, as have other airline stocks, as a slew of flight cancellations threaten to mar the commencement of the holiday flight season.
Mass cancellation of flights due to staff shortages has hit IAG’s component airlines, such as British Airways, Iberia and Vueling. The stock is also facing headwinds from an investor revolt over the pay package for British Airways CEO Luis Gallego. At a shareholders’ meeting in Madrid on 15 June, 17.78% of investors opposed a pay package of nearly £5 million if he hits performance milestones for 2022.
Gallego and his management have faced criticism over their handling of the affairs of the airlines, particularly British Airways. Passengers have complained of long delays, higher fares and non-responsive customer service lines.
Technically speaking, the decline seen on the chart commenced from the breakdown of the wedge pattern, seen on 6 May 2022. This decline found completion at 124.48, followed by an upward retracement which met rejection at 136.64. The following decline broke down the 124.48 support and eventually formed a bearish flag. Following the flag’s completion, what is the IAG share price outlook?
IAG Share Price Outlook
The bounce on the 110.26 support level (7 March low) marks the end of the bearish flag pattern on the daily chart. However, the support level remains under pressure. If there is a return move to the broken flag consolidation border and a subsequent pullback and breakdown of 110.26, the 102.68 becomes the next downside target.
Below this level, additional support is seen at 96.74 (30 October 2020 high) and the 3 November 2020 low at 88.92. On the flip side, a break of 124.48 (12 May high) is needed to send the stock higher. The 136.64 resistance becomes the new target in this circumstance, leaving 14394 and 149.72 (30 March and 4 May highs) as additional targets to the north.
IAG: Daily Chart
