GSK share price wiped off its weekly gains in the last two sessions of the week after a rejection from the £14.88 level. This rejection occurred due to a failed breakout attempt above the 200-weekly moving average. This is a long-term moving average which shows the overall market sentiment around a stock.
After reversing from their weekly high of £14.88, GSK shares had their biggest losing day of the week on Friday. The shares plummeted 2.91% and closed at £14.19 which was their lowest level since 30 November.
The future price action depends on the bulls’ ability to hold the 200-daily MA, which is currently acting as a support. This moving average lies at £14.22 and needs to be held to avoid another retest of the lows of a long-term trading range which lies around £13.32.
After a 1.06% drop this week, GSK stock has underperformed the FTSE 100 index which rose 0.29% during the same time. The stock also underperformed compared to the monthly gains of the Medical sector which remained at 7.01%.
All eyes are now on the upcoming release of the financial results, where the company is expected to report EPS of $0.79, a 23.44% increase on a YoY basis.
The following chart shows the technical analysis of the LON: GSK weekly chart. Such a high timeframe analysis removes the fakeouts and noise to reveal a bigger picture. For the past 11 years, the stock has been trading within the £13.3-£18.34 trading range without any significant breakout.
Nevertheless, the GSK share price forecast may flip bullish if the stock breaks above the 200-weekly moving average. However, in the event of acceptance below £14.22, a retest of the range lows will be on the cards. For this purpose, the next few weeks will be very critical.
This post was last modified on Dec 16, 2023, 18:11 GMT 18:11