Rolls Royce share price seems to have recovered well from Monday’s market shock. Airline stocks were put under pressure by the news of the emergence of a mutant coronavirus strain, which led to several EU nations closing their borders to the UK.
Rolls Royce may have suffered greatly this year as a result of the pandemic, but it is gradually rebuilding itself from the basics. An October round of rights and bonds issues led to an extra £5bn liquidity boost, as well as plans to invest significantly in the company’s power systems division seem to be the drivers for a recovery of the stock.
The company has also announced a partnership with Infosys, to drive research and development for the expansion of its civil aerospace business. This is as the rollout of coronavirus vaccines are expected to bring normalcy to the aviation sector in the coming year.
Technical Levels to Watch
Rolls Royce share price is currently challenging the resistance at 116.05, having come off a nice bounce on the ascending support trendline which connects the 2 October and 9 November lows. With such a narrow band between the 116.05 resistance and the trendline, price is due for a push on either side.
A break of the 116.05 resistance allows 122.30 to come into the picture as the immediate upside target, with 134.30 serving as an additional target to the north.
On the flip side, a breakdown of the trendline allows 103.65 to become the next downside target, with 99.90 and 95.05 lining up as additional targets to the south.
Rolls Royce Daily Chart