Tesco (LON: TSCO) share price has behaved exactly as mentioned in my previous article. I predicted the shares to hit the 288p level, and the shares reversed from 286p, which was quite close. The latest analysis reveals that the bears have started to gain momentum.
On Wednesday, UK stocks showed a very negative sentiment. The benchmark FTSE 100 index tanked for the second straight day in a row and lost 72 points. The latest analysis reveals that Tesco shares have plummeted below a key level on its chart.
The latest data reveals that the UK grocery inflation remained at 17.2% in May. This shows the second consecutive month of decrease. In other news, the UK government is considering to ask retailers to cap the prices of basic food items.
Despite a decrease in profits, Tesco share price still surged to its fresh yearly highs in May 2023. This suggested that the investors expect the company to report strong earnings this year. However, the shares failed to gain strength above 272p and had a pullback.
Tesco Share Price May Hit 242p
The LON: TSCO chart shows that the bears are making a comeback after a strong uptrend. The price soared above its August 2022 highs in May 2023 but failed to hit the 288p resistance. This puts the likelihood of another bounce on the cards.
However, the Tesco share price forecast will remain bearish as long as the stock trades below the 272p level. A reclaim of this level can trigger another rally in the shares of the major grocery retailer. The next month’s inflation data will play a key role in this regard.
I’ll keep sharing my updated price outlook on Tesco & other stocks in my free Telegram group, which you’re welcome to join.