Last week, Allianz SE (ETR: ALV) reported its Q1 earnings, which were significantly hurt by the whole ongoing situation with COVID-19. Although the asset management segment of the business showed good results, most of those were offset by the Life/Health and Property-Casualty sides of the business. However, given that governments around the world are slowly easing off their restrictions on movement, there is a bit of hope that the company can do some damage-control and regain some investor confidence.
Looking at the technical picture of the Allianz SE stock on the 4-hour chart, from around the end of April, the share price was drifting south, while trading below a short-term downside resistance line taken from the high of April 30th. That was the case until Friday, when the stock broke and closed above that line. This morning, ALV opened with a gap to the upside, which may help some new investors to join in and lift the share price higher in the short run. We will get slightly more comfortable with higher areas, if the price jumps above the 153.50 barrier, hence our somewhat bullish approach for now.
As mentioned above, if the stock rises above the 153.50 barrier, marked by the low of May 7th, this could attract a few extra buyers into the game. Such activity might help ALV to get a boost to move further up, towards its next potential resistance zone, at the 159.22 hurdle, which is marked near the highs of May 8th and 11th. Initially, the share price could stall there for a bit, however, if there is still enough buying interest, a further push higher could send ALV to the 167.84 level, marked by the high of May 6th.
The RSI and the MACD seem to be somewhat in support of the above-discussed scenario. The RSI is pointing higher, although it remains slightly below 50. The MACD had just pushed above its trigger line and is also showing willingness to move higher, despite being below zero still.
Alternatively, if the share price falls back below the aforementioned downside line and also drops below the current lowest point of May, at 139.74, this would confirm a forthcoming lower low and might temporarily spook new buyers. We will then target the 129.74 obstacle, a break of which could send ALV towards the 125.54 level, which is the low of March 23rd.
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