After suffering a good beating in the first half of the year, the stock of Philip Morris is becoming quite attractive in the eyes of investors who like this type of company stocks. One good reason for that is, although there is a huge alternative market of e-cigarettes, which is a direct competition, still, tobacco remains quite inelastic and that’s why big companies like Philip Morris are able to continue increasing their prices, in order to offset the slight drops in sales.
From the technical side, we can see that Philip Morris stock is currently consolidating and is within a range, between the 76.20 and 87.40 price tags. Also, what is important to mention, is that the stock is trading below its long-term downwards moving trendline, taken from the peak of the 20th of June 2017.
If we will see the share price moving above the 87.40 barrier, this could indicate that the buyers are trying to take control and potentially lift it higher. More bulls could start joining in and driving the stock higher, towards the 92.15 zone, marked by the lower side of the gap seen between the 18th and the 19th of April. If that level doesn’t stop the price from rising, the next potential area of resistance could be around the 95.45 hurdle, which was the low of the 23rd of March. If the price continues to accelerate, then it could hit the aforementioned downwards moving trendline that could slow down the bulls for a while.
Alternatively, a break below the lower bound of the previously mentioned range could set the stage for some further declines, where the bears could take Philip Morris down to the 72.55 obstacle, marked by the lowest point of January 2012. The next good support below that could be at 70.80, which was the low of the 22nd of November 2011.
The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. JFD Brokers, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD Brokers analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyzes and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyzes and must therefore be viewed by the reader as marketing information. JFD Brokers prohibits the duplication or publication without explicit approval.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with the Company. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure.
Copyright 2018 JFD Brokers Ltd.