The Royal Mail share price has been in a strong bullish trend in the past few weeks. The RMG stock is trading at 526p, which is the highest it has been since July 2021. It has risen by 38% above the lowest level in October last year.
Royal Mail was among the best-performing stocks in the FTSE 100 in 2021 as its share price jumped by almost 70%. This increase helped the company move to the blue-chip index. However, the rally was not smooth considering that the stock fell by 32% between June and October.
The recent rally came after the company announced a 400 million pound windfall to shareholders as its business did well. The recent trends in Omicron have pushed more people to stay at home, increasing the demand for mail and parcel.
2022 will be a pivotal year for Royal Mail. The company will need to prove that it can continue doing well even as demand for parcels is expected to decline as the Covid-19 cases flatten or drop.
The daily chart reveals that the RMG share price has been in a strong bullish trend in the past few weeks. This price action has pushed the stock above the 25-day and 50-day moving averages while oscillators have also risen. The stock is above the Ichimoku cloud.
While these are bullish signs, the stock has also formed a rising wedge pattern. In price action analysis, a rising wedge pattern is usually a bearish sign.
Therefore, the stock will likely have a bearish breakout later on this month. If this happens, the stock could move below the support at 500p. On the flip side, a move above the resistance at 535p will invalidate the bearish view.
This post was last modified on %s = human-readable time difference 08:06