The Tesco share price is slightly higher this Wednesday, but price action lacks bullish momentum. This follows a series of developments which are denting sentiment on the stock.
A local news report quotes food industry experts as issuing warnings to UK shoppers to expect price increases of as much as 20% on bread, due to rising global demand that has raised wheat prices by 26.7% on a year-on-year basis. The increases are also said to be due to increase in prices of gas used in the baking facilities, and fuel used in the distribution trucks.
A recent report by the Food and Agricultural Organization (FAO) says that food prices are now at global 10-year highs. Investors in supermarket stocks appear to be worried about how the situation will impact customers’ shopping habits this holiday season, which kicks off in 2 days with the Black Friday shopping fiesta.
The Tesco share price is up marginally by 0.05%.
Tesco Share Price Outlook
The Tesco share price has bounced off the ascending trendline support, which raises the prospects of a push towards the 283.80 resistance level. A break of this area targets 287.50, the site of Tesco’s 2021 high. 293.35 only becomes available if the 2021 high is broken.
On the other hand, a lack of bullish momentum and a breakdown of the ascending trendline could target 271.70, but only if the support at 277.80 gives way. 267.15 and 264.45 are additional support levels, which could come into play if the bears take out the 271.70 support. A further price deterioration brings the 6 October low at 259.80 into the picture.