Rolls-Royce (LON: RR) share price has been trading sideways for the past few weeks. After a pullback in March, the shares are currently retesting 146p once again. The prolonged consolidation around a key resistance level suggests that a major move is just around the corner.
The UK stock market showed an overall positive price action on Tuesday. The benchmark FTSE 100 index was up 0.38% after gaining 29 points during the first trading session after Easter Holidays. Nevertheless, Rolls-Royce shares turned red after opening higher. Till press time, the stock was trading at 146.3p and was down 1.15%.
According to the latest filing, California-based majority employee-owned investment management firm Causeway Capital Management had disclosed its 6.98% stake in Rolls-Royce. This is lower than the previous filing by the firm, which showed a 7.87% stake.
Rolls-Royce share price has been the best-performing FTSE 100 stock in Q1 2023. The aviation giant generated 56.6% gains during the first quarter of the year. This shows that the shareholders have faith in the new CEO, Tufan Erginbilgic, to turn things around after years of stock devaluation. The company’s core business of servicing aircraft engines is set to thrive in 2023 as the flight hours approach their pre-lockdown levels.
The LON: RR chart shows a prolonged sideways price action at a very critical resistance level. The 146p level has resulted in a major rejection during the past couple of years. A consolidation around this level is a sign of a battle between the bulls and the bears. If bears gain control, I expect the price to retest the upward trendline below 130p.
However, considering the current uptrend, an upwards breakout is more likely. This will flip Roll-Royce share price prediction very bullish. Such a move may result in a bigger rally towards the 170p-184p region to fill the gap. This can be a potential 25% move from the current price level. The global macroeconomics, along with US & UK inflation data, will be the key factors affecting the price action.
This post was last modified on %s = human-readable time difference 15:31