Deliveroo shares have emerged as one of the strongest equities in the UK stock market. The stock has continued to show resilience despite fresh 2-month lows in the FTSE 100 index. This improved market sentiment is a fruit of the recently reported Q3 results.
On Wednesday, UK equities showed a mixed price action as the FTSE 100 index turned green. Deliveroo shares opened lower but the buyers stepped in. At the time of writing, the shares of the company providing delivery services were down 1.44% from their previous close.
The recent positive sentiment surrounding LON: ROO can be attributed to a 5% increase in Q3 gross transactional value. In addition, the group also maintained its full year financial guidance which further boosted investor sentiment. Consequently, Deliveroo share price is trading just a few points below its yearly peak.
The recently reported Q3 results revealed that the company’s sales fell 1% in the third quarter. Overall, this was a 6% decrease in the first half of the year. The firm attributed the growth in third quarter gross transactional value (GTV) to expanded selection, targeted promotions and service enhancements.
I mentioned the significance of the 131p resistance in my previous forecast. This level was tested in August but resulted in a major correction. After a recent higher high on the daily chart, another retest of this level is on the cards.
However, a breakdown below 112p will invalidate this bullish Deliveroo share price forecast. This may trigger a bearish leg toward 200 MA which lies around 106p. Another major level which needs to be held at any cost is the previous range high around 101p. A break below this level will be very bearish.
The next week’s interest rates decision in the US might impact the price action of the UK equities.
This post was last modified on Oct 25, 2023, 16:49 BST 16:49