Tesco Share Price Outlook: Downside Bias Persists Despite Bullish Wednesday

Tesco share price is up slightly today, shaking of Tuesday’s losses and what has generally been a lackluster performance for the week so far. This is despite reports of the company being hit with a huge fine after a worker was badly injured by a falling cage of juice cartons, as well as news of a product recall following a packaging mixup,

With parts of London stepping into a Tier 3 lockdown, panicked UK shoppers have been asked by the Business Secretary Alok Sharma not to stockpile food ahead of the Christmas holiday.

Tesco Chairman Allan had warned last week that there could be higher prices for food products on supermarket shelves if there is a no-deal Brexit, as there would be no guarantees that supply chains would not be disrupted if this is the case. He however had reassured shoppers that the company had pre-emptively started to stockpile food products, which provided the basis for Sharma’s advice to shoppers not to panic.

Technical Outlook for Tesco

Tesco’s share price action on the daily chart is carving out a megaphone topping pattern on the chart. Within the pattern, the price has met resistance at 228.0 and requires a breakout to take Tesco’s share price towards 231.4 and possibly 234.3, which marks the upper boundary of the expanding triangle. Only a break towards 239.7 invalidates the pattern.

On the other hand, a rejection at the current resistance allows sellers to target the lower boundary of the pattern. This move has to take out 224.0 to get there. A breakdown of the lower boundary completes the pattern and sets up 214.0 and 211.3 as the next downside targets. 

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Tesco Share Price; Daily Chart

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