The Tesco share price is down 1.24%, making a bearish start to the trading session on Thursday. This puts the Tesco share price on course for a second straight day of losses. Last week, we identified a report by NielsenQ on the negative impact of food and energy inflation on UK shoppers and how this was identified to be a headwind to the Tesco share price recovery effort. This factor continues to trigger price action in the short term.
UK retail market analytics company Kantar also indicated that UK grocery inflation was at 4.3%, with the conflict in Ukraine contributing to the situation. This is the fastest growth in consumer inflation in nine years. The violation of the 276.80 support line leaves buyers vulnerable, with a push towards 269.65p looking more likely with the intraday degradation of that support level.
Tesco Share Price Outlook
The Tesco share price is in the middle of the a-b-c corrective way sequence, following the completion of the bearish Elliot impulse 1-2-3-4-5 wave sequence. The downward move of the day follows the rejection of the price at 281.15 to start the b wave in the corrective wave sequence. The 269.65 support level (21 October 2021 and 14 March 2022 lows) is the immediate target following this violation of 276.80. If the bulls fail to defend this support, then a move towards 264.85 and potentially 259.80 cannot be ruled out.
On the flip side, the bulls need to see the price activity breaking the 281.15 resistance, opening the door towards the 287.50 resistance. Above this level, 293.35 and 304.15 are the immediate price targets as the northbound move continues.