Ocado share price continues its surge into record territory after new industry data revealed that the company experienced an explosion in sales, despite a slowdown in the grocery sales sector of the UK. Growth in the grocery market by 14.4% in the last three months was less than the market record of 16.9% seen last month, but results show that Ocado grew its market share to 1.8% on the back of double-digit growth number for the 3rd consecutive month.
Some of this success is due to the Eat Out to Help Out campaign launched by the UK government and has generally been successful as bars, restaurants and cafes are seeing increased sales.
The BBC reports that more than 35 million meals have been served in the last two weeks that the campaign has run; a figure that the Chancellor of the Exchequer Rishi Sunak says equates to half of the UK taking part. Data also show that diners and restaurants are experiencing 27% more traffic this August between Mondays and Wednesdays, than in the same period in 2019. Ocado supplies some of the restaurants which are part of the scheme.
The stock is pushing towards new highs and presently trades 0.67% higher at 2398. It had touched off 2423 earlier in the day. 2423 now marks the level to beat for buyers. Above this level, we could see a push towards the 2500 psychological resistance. More realistically, we could see price trading between the borders of the ascending channel, touching off each edge as it cruises to new highs.
On the flip side, a breakdown of the channel could precipitate a push lower towards 2247, with 2180 and 2078 making up other support targets in the near term. 1995 and 1898 are also near term support targets, with 1995 marking an area of a previous secure cluster of lows in July 2020.
