AACHEN, GERMANY - MARCH 01, 2019: Vodafone store of British multinational telecommunications conglomerate brand logo located in Aachen shopping street Germany. Mobile photo
Vodafone share price faces headwinds ahead of its earnings report for third quarter. On Thursday, the shares of the British telecom slid 1.3% after Barclays slashed its price target for Vodafone by 5p while maintaining its “Equal-Weight” rating.
The FTSE 100 index failed to break above the 7680-point key resistance level earlier this week. This resulted in intense selling in most UK shares. Vodafone also tumbled as bearish sentiment prevailed and slid 7.5% below its 200 MA.
The British labor union expects the merger of Vodafone and Three would lead to increased costs. This means that there would be a strong chance of massive layoffs. However, a spokesperson for Vodafone claims otherwise. She stated that this merger would create more jobs for “building the network, and to create and support the IT systems, and to maintain this new network”.
According to executives of Vodafone, the £15 billion merger will improve the 5g infrastructure in the UK to make it on par with other European countries. Three’s spokesperson announced no price increase for consumers despite a drop in UK network operators from 4 to 3.
VOD stock has gained acceptance below the 82p level which is the previous support now acting as a resistance. The same level also has a confluence with the 200 MA level which lies at 83p. The chart below also shows the price forming a symmetrical triangle.
The Vodafone share price forecast looks bearish as the price could not break above the downward trendline. This move might pave the way for a retest of 75p which is the October low. A break below 75p will most likely trigger a 6.5% correction all the way to the 69p support level.
You can also follow me on Twitter to stay alert on the current market trends and my personal stock trades.
This post was last modified on Oct 19, 2023, 23:08 BST 23:08