- Summary:
- The Twitter share price is set to pump higher as Elon Musk raises his cash contribution for the takeover deal.
The Twitter share price picked up steam yesterday, gaining 6.35% after the world’s richest man and Tesla CEO Elon Musk raised his takeover bid to $33.5 billion. Musk, whose takeover bid for the social media company was accepted last month, increased his cash contribution to the deal by $6.25 billion, taking his contribution to $33.5 billion.
A consortium of investors, including investment banks and private equity firms, had pledged to provide financing for the rest of the deal, to be collateralized by an equivalent amount of Musk’s Tesla stake. However, not everyone seems pleased with the slow pace of completion of the sale.
The Tesla CEO has been sued by a section of Twitter investors, who allege he is manipulating the stock’s price to send it downward. The lawsuit also alleges that Musk failed to disclose the amount of stake he purchased in the company on 5 March, which allowed him to save $156m.
Twitter has also been joined in the suit, with the said investors alleging a failure of the company to investigate Musk’s activities. The Twitter share price is trading at $39.71 in premarket trading, slightly higher than Thursday’s closing price of $39.52.
Twitter Share Price Forecast
Thursday’s uptick has broken the 38.03 resistance (21 March and 23 May high), thus cutting a path toward the 42.33 resistance. Attainment of this level closes the gap of 16 May. If the bulls uncap this resistance barrier, 45.01 (30 December 2021 low and 11 April 2022 high) becomes the new target. This move would cover the 13 May gap. 48.46 (8 April high) and 50.23 (6 May high) are additional targets to the north.
On the other hand, the bears need to degrade the support at 38.03 to make 35.63 available as an immediate downside target. Below this 24 May low, 32.05 is another potential pivot which becomes viable if the 35.63 support yields to bearish pressure.
Twitter: Daily Chart
