Tesco share price (LON: TSCO) is o its way to closing the week strong. The shares of the biggest UK retailer gained 0.81% on Friday, resulting in a weekly gain of 3.81%. Tesco shares appear to be gaining strength above the key resistance of 246p after a successful retest on Monday.
Tesco plc stock has been enjoying a massive recovery since its October 2022 low of 194p. Since then, the price has surged by more than 31.5%. The uptrend started with a positive earnings report that beat expectations by 5.64%. The shares of the parent company of Tesco express gained even more momentum at the start of 2023 as most UK equities started to show strength.
Why Are Tesco Shares Surging?
Due to constant rate hikes by US Fed throughout last year, investor interest in dividend stocks has increased. Another reason for a tremendous recovery in LON: TSCO price is the surging FTSE 100. Last month, the benchmark UK index made a new all-time high by breaking above 8000 points for the first time. Tesco share price also benefitted from this flow of capital.
This made FTSE 100 index one of the few global indices that hit an all-time high in 2023. S&P 500 and NASDAQ 100 are still trading well below their 2021 all-time highs. This shows that the interest in UK stocks has increased over the past few months due to very high interest rates in the US. The US stocks are expected to remain in a downtrend this month as investors are expecting another 50 bps hike in the March FOMC meeting.
TESCO Share Price Prediction
The following chart of LON: TSCO reveals certain key levels. Among these level, 246p is the most critical level. This level has previously acted as a major support as well as resistance. Although the price is trading above this level for the time being, a break below this level will be very bearish.
For a proper bullish Tesco price forecast, the price needs to flip the August 2022 high of 272p into support. In the coming weeks, I expect a retest of this level. Rejection from this level can tank the price to 200-day moving average that lies at 241p.
