GBPUSD
The BT share price is wavering as investors wait for the company’s upcoming earnings. The stock ended Monday at 187p, which was close to last week’s low of 183.50. It has risen by almost 100% from its lowest level last year.
BT news. BT is the UK’s biggest telecommunication company with a market capitalization of more than $25 billion. The company competes with other top brands like TalkTalk and Vodafone. The most important recent news on BT was that the firm reached an agreement with the Communication Workers Union (CWU) on the firm’s modernization plan.
This means that the company will avert its first major strike in decades. Another positive BT news is that Italy’s antitrust agency gave approval to TIM to buy some of BT’s assets in the country. The two companies reached an agreement for the deal in December last year.
Meanwhile, the company is in the process of offloading its sports television business. While a deal is not yet done, there are signs that Rupert Murdoch will buy the assets. This will be a positive thing since it will leave BT to focus on its Openreach program and its telecommunication business.
At the same time, as shown below, a DCF calculation shows that BT is currently trading at a 34.4% discount. The calculation estimates that the stock is worth about 2.85 pounds.
The daily chart below shows that the BT stock price has been in a sharp bullish trend recently. Along the way, the shares have formed the classic Elliot wave pattern. It has already completed the first three sections and is now in the fourth section. At the same time, the bullish trend is being supported by the 50-day and 200-day moving averages that made a golden cross a few weeks ago.
Therefore, I suspect that the stock will bounce back as investors target the next key resistance at 250p. To do that, the shares will first need to move above the resistance at 200p. On the flip side, a drop below 170p will invalidate this trend.
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