The Persimmon share price will be in the spotlight today after the latest earnings by Taylor Wimpey. PSN shares rose by more than 6% yesterday as traders waited for its earnings that will come out tomorrow.
What happened: Taylor Wimpey and Persimmon are two of the biggest housebuilders in the UK. They have a market cap of more than £6 billion and £8.7 billion, respectively. Therefore, their share prices tend to move in the same direction.
In its earnings today, Taylor Wimpey said that it generated more than £264.4 million in pretax profits. This was a sharp decline from the £835 million it made in the previous year. In total, its revenue dropped by 36% to £2.79 billion. It also reinstated its dividend, which it canceled last year in its bid to save cash.
Therefore, the Persimmon share price will be in the spotlight today as traders wait for its earnings tomorrow. Analysts wait for a similar decline and for the company to also reinstate its dividends.
The four-hour chart shows that the Persimmon stock has been moving sideways in the past few weeks. It has remained between the support and resistance levels of 2,530p and 2,835p. Also, it is slightly above the 25-period and 15-period moving averages.
Therefore, in my view, the stock will remain in the current range ahead of its quarterly and annual earnings. However, a move above the resistance at 2,835p will be a victory for the bulls while a drop below the support at 2,530p will be a victory for the bears. This will see it retest the 38.2% retracement level at 2,676p.
