The IAG share price is up 0.85% this Monday, but it is barely hanging on the morning’s gains as the price action looks to break down a key bearish pattern, backed by a fundamentally negative trigger. IAG’s British Airways looks set to face a strike action from its Heathrow Airport workers over pay.
The origin of the strike action can be traced to the refusal of British Airways to do away with the 10% pay cut implemented during the nil-revenue pandemic period to cut the airline’s costs. As a result, around 95% of the workers who voted have called for a strike that would add to the disruptions already experienced from worker shortages, which could mar this year’s summer holiday travel schedule.
Technically speaking, the price picture on the daily chart is that of a bearish flag, which is expected to end in a bearish continuation of the preceding trend. Therefore, here is the IAG share price forecast.
The evolving bearish flag pattern on the daily chart is at a point where the price action is challenging the lower border. A breakdown of this level clears the pathway towards the 110.26 support (7 March 2022 low). The measured move from the pattern has 96.74 as the completion point.
The attainment of this point requires a breakdown of the 102.68 (3 August 2020 and 6 November 2020 lows) support mark. An additional target to the south is the 88.92 support level, the location of the low of 3 November 2020. On the other hand, the pattern will be invalidated if the 124.48 resistance intersecting the flag’s upper border is broken.
This move could come from a bounce on the flag’s lower edge. A break of 124.48 opens the door toward the 136.64 resistance barrier (30 May 2022 high), with 143.94 (30 December 2021 and 3 March 2022 highs) and 149.72 (30 March and 4 May highs) serving as additional northbound targets.
This post was last modified on %s = human-readable time difference 13:44