Tesco (LON: TSCO) share price has behaved exactly as I predicted in my analysis two weeks ago. The shares of the retail giant have had a strong rebound. While some analysts might be surprised by this move, I’m not surprised at all, as a bounce was written all over the chart.
The benchmark of UK equities, FTSE 100 index currently stands at 7,656 points, which is the highest level in last 4 weeks. After a 1.09% jump on Thursday, Tesco shares extended their gains by another 0.52% on Friday. Till press time, the shares were trading at 261.5p.
UK Inflation Dropped To 7.9% In June
According to the recently released CPI data for June 2023, the YoY inflation for the month remained at 7.9%. This was at par with the Bank of England’s expectations. The data suggests that the inflation in the UK is finally cooling down after soaring to double digits earlier this year.
Tesco share price got a boost from the decreasing inflation. The stock of the grocery retailer is now trading at its fresh 4-week highs. As per the latest news, Tesco plc has signed a deal to occupy commercial space within Inland Homes’ Cheshunt Lakeside development.
Tesco Share Price Prepares For Another 272p Retest
A look at the following LON: TSCO chart suggests that the stock is heading for a retest of the 272p level. This is a major resistance level that has resulted in multiple rejections in the past. This could mean a potential 4% upside from the current level.
In my previous Tesco share price forecast, I predicted a bounce due to the bullish divergences in RSI and MFI. This has played out exactly as I forecasted. If the shares gain strength above 272p, a strong bullish leg might get triggered. This will be only likely if inflation keeps decreasing in the coming months.
In the meantime, I’ll keep sharing updated Tesco stock price forecasts and my personal trades on my Twitter, where you are welcome to follow me.
