Orsted (CPH: ORSTED) share price took a 27% nosedive after the Danish power company announced a 16 billion kroner loss. The candle closed at 420 kroner on Wednesday which was the new 5-yearly low. The price showed some relief bounce on Thursday, as the shares were trading at 432 kroner, up 2.6% for the day.
The OMX COPENHAGEN25 Index fell by 44 points yesterday after $8 billion dollars was wiped off Orsted’s market value. This news translated into fear in the Danish stock market as the index sat only 0.6% above its monthly low of August.
On Tuesday, Orsted revealed that three of their companies operating in the US are facing supply chain issues that could result in a 5 billion kroner loss. A further 5 billion kroner loss is expected due to high-interest rates. The renewable energy company also feared another 6 billion kroner loss if additional tax credits were not offered.
In other news, the US Interior Department approved the construction of a 704-megawatt (MW) wind farm off the coast of Rhode Island that will be owned by Orsted and Eversource. Orsted share price is currenlty 37.50% down from its yearly peak.
The price chart for CPH: ORSTED shows the price found strong support at 420 kroner, which is at the bottom of the falling wedge pattern. On Thursday, the price showed a slight recovery, suggesting the bears are resting after orchstrating a 27% correction.
The bulls are in deep trouble as Orsted share price forecast has flipped extremely bearish. For the outlook to flip bullish, the price requires a 33% rally towards the drawn 553-580 kroner demand zone. Only a reclaim of this region could avoid more downside.
In the meantime, I’ll keep sharing the updated Orsted forecast and my personal trades on my Twitter, where you are welcome to follow me.
This post was last modified on Aug 31, 2023, 12:21 BST 12:21