The Rolls Royce share price has made a positive start to the week, soaring 3.79% as it breaches the 90p price mark for the first time since 21 June. The stock is aiming for a critical test of resistance, even as it starts to conduct engine tests to gauge the potential of hydrogen-powered jet engines.
The positive sentiment shown by investors to the Rolls Royce share price comes as the company says it will launch tests to show the safety and efficacy of jets powered by alternative fuels. It is conducting the tests on its AE2100 and Pearl 15 engines after years of research show the potential for a new generation of hydrogen-fueled jet engines.
The tests indicate that the company may be more ready than most analysts had thought to switch to cleaner fuels as the push to cut emissions from present systems grows. In addition, the continuation of its aerospace business recovery could see Rolls Royce resume dividend payments as early as 2023. Citibank analysts are projecting a dividend of 0.7p per share in 2023. This is also a factor fueling the 2-day surge in the Rolls Royce share price.
Rolls Royce Share Price Forecast
The intraday uptick has violated the neckline of the evolving double bottom pattern. If the candle closes at this level or higher, it fulfils the 3% penetration close price filter that confirms the double bottom. This situation opens the door for a measured move toward the 94.61 resistance level (4 March 2022 high). This move must clear the resistance barrier at 90.98 (12 April and 10 June 2022 highs) to achieve completion. Other north targets are 97.26 (21 April 2022 high) and the 100.05 psychological price barrier.
Conversely, the bears would be seeking to truncate the upside move, with a breakdown of the 86.40 neckline as the primary objective. A decline below this support targets 82.21 initially (23 May and 7 July 2022 low). 78.20 (10 May 2022 low) and 73.23 (3 August 2020 low) enter the picture as additional downside targets if there is further price deterioration. 67.65 is the prior low of 6 November 2020 that only becomes viable if the price activity descends below 73.23.
RR: Daily Chart
