The EDP Renovaveis SA stock opened with a small positive gap today, but hit resistance at 17.85, and then, it pulled back. Overall, the stock has been trading in a sideways manner since March 2nd, between 16.00 and 18.27, and thus, we would consider the short-term outlook to be neutral for now.
In order to start examining the bullish case, we would like to see a clear break above the range’s upper bound, at 18.27. This may encourage investors to target the 19.10 barrier, marked by the highs of February 25nd and March 2nd, or the peak of February 19th, at around 19.90. If that hurdle is broken as well, then we may see more bullish extensions, perhaps towards the high of February 16th, at 21.25.
Turning our gaze to the short-term oscillators, we see that the RSI, although slightly above 50, has turned down again, while the MACD lies near both its zero and trigger lines, pointing east. Both indicators suggest lack of directional momentum and enhance our choice to stay on the sidelines for now.
On the downside, we would like to see a dip below 16.00 before we start examining larger declines. Such a move would confirm a forthcoming lower low on the daily chart and may initially target the psychological zone of 15.00, which is also marked by the inside swing high of September 2nd. If that zone is not able to halt the slide, then we could see extensions towards the low of September 25th, at 13.55.
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