Tesco Share Price Shows Signs of Weakness at Critical Resistance

Tesco share price is trading around a confluence of resistance around 235.0. Looking at the technical setups on the daily, 4-hour, and 1-hour charts, it would seem that sellers are looking to push the stock lower.

On the daily time frame, it can be seen that the Tesco share price is testing the falling trend line (from connecting the highs of February 20 and March 10). This area, around 235.0, also seems to coincide with the 200 SMA on the daily chart.

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A closer look at the 4-hour time frame would show that a handful of reversal candlesticks have already formed. The trend line which was drawn on the daily time frame also coincides with the 100 SMA on this time frame. These could mean that there are already sellers in the market looking to push the Tesco share price lower. Near-term support is at 218.5 where the stock found support on February 28.

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Then on the 1-hour time frame, a rising wedge pattern becomes apparent. This is considered as a bearish reversal indicator which only affirms the bearish assumption presented on the higher-time frames.

What could keep the Tesco share price from falling?

With governments already presenting their plans to stimulate their respective economies, it would seem that equities markets are looking for more silver linings amid the coronavirus pandemic. News about developments in vaccine, declining cases and death toll, and more proactive measures from policymakers could fuel risk appetite and push Tesco share price higher. Should this happen, we can expect a strong close above 235.0 on the daily time frame. It could then mean that Tesco share price is on its way to near-term resistance at 249.5 where the stock topped on March 10.More content