The Ocado share price remains under pressure this Wednesday after the UK government opted not to widen restrictions ahead of the Christmas holiday.
The season, which traditionally comes with the exchange of gifts, brought the Ocado share price to multi-year highs in the same period in 2020, as a locked-down nation had to depend on logistics companies for most of their shopping. The opposite is the case this year, and the Ocado share price now finds itself trading at nearly half of its December 2020 highs.
The Ocado share price is also coming off the back of a slightly disappointing 4th quarter result for Ocado Retail, where revenue declined 39%. Despite being marginally higher on the day (+0.46% as of writing), the emerging pattern indicates dwindling buying momentum and more sustained pressure from the bears.
Ocado Share Price Outlook
The daily chart reveals a bearish flag in formation, with the price candle already violating the flag’s lower border. However, the support at 1630.5 is resisting this breakdown attempt. The bears need to force a breakdown of the 1630.5 support to complete the bearish flag. This scenario opens the door for the pursuit of a measured move via price deterioration towards 1415.0 (7 April 2020 high). This move needs to degrade the support levels at 1558.0 and 1486.5 to succeed.
On the flip side, the outlook can be negated if the price action sees a bounce on the 1630.5 support line, with an extension beyond the 1699.5 resistance. This move opens the door for the bulls to aim for the 1824.5 resistance, with 1957.5 and 2135.0 lining up as potential barriers to the north.