The Tesco share price fell heavily on Friday after it recorded only marginal sales growth despite greater online demand in the UK. Tesco share price recorded its heaviest daily drop since May 28 as it failed to capitalize on the growth numbers seen at the start of the coronavirus pandemic in 2020.
Online sales had soared 22.2% in the period under review, but Tesco recorded a 1% year-on-year increase in 13-week sales (ended May 29), totaling 13.4 billion pounds sterling. This sales growth paled compared to the 7.1% sales growth increase seen in the same period from 2019 to 2020, which was a 7.1% increase. Like-for-like sales grew 0.5% yearly in the UK but fell 6.1% in Ireland and 1.6% in its Central European division.
Forward guidance remains unchanged, but the company sees a decline in sales volumes as the UK eases the last batch of restrictions. Tesco share price is down 3.51% as of writing.
Technical Levels to Watch
The large symmetrical triangle on the daily chart is currently at risk, as the large bearish candle is challenging the lower edge. A breakdown of this triangle could lead to a large move south, taking out support levels at 220.20 and 217.50 along the way. The 215.00 psychological support (Oct. 23 low) also lends itself as a new target.
On the other hand, the Tesco share price has to break past the resistance at 236.00 to restore the recovery on the stock. This move would need to take out barriers at 224.0, 228.05, 231.90, 234.25 and 236.00 to be actualized. This may come off a bounce on the lower edge of the symmetrical triangle.