- The stock price of Fever-Tree has exhibited a recent downtrend following price rejections at certain levels.
- The stock is seen in line with its 50 EMA.
- The bulls could not sustain the RSI above its neutral level.
The Fever-Tree stock price began to rise after its half-yearly earnings report in June 2022, which indicated a 13% increase in earnings. This upward movement was further boosted by a dividend announcement from the company in September 2022, propelling the price from £821 to £1,307 within a span of 3 months, marking a remarkable 59% growth.
Subsequently, the stock went through a period of consolidation until the end of March 2023. Following this consolidation, the bulls gained momentum and managed to break through the resistance level at £1,209, leading to a resurgence of the bullish rally.
Technical Analysis of Fever-Tree
Currently, FEVR stock has undergone some minor bearish correction after a period of consolidation within certain support and resistance levels. The indicators provide insights into the potential near-future trends:
Support: The stock faced rejections from the bulls around its immediate support at £1,304, accompanied by significant trading volume. The second support has a broader zone in accordance with technical analysis, with a risk-oriented line drawn at £1,182.
Resistances: The initial and immediate resistance is situated at £1,446, where recent bearish rejections occurred. Following this, the second resistance is at £1,514, without recent touchpoints within the past year.
MACD: The MACD chart depicts a recent downtrend, initiated by the crossover of the signal line and the MACD line in early August 2023. Presently, the MACD line is below the neutral level at -1.30, while the signal line is considerably higher at 5.90.
RSI: The RSI graph reflects similar observations. After reaching a level of 71, the RSI line faced substantial bearish pressure and descended to the neutral level of 50. It experienced a rebound at this point, but the prevailing bearish trend weakened the bullish sentiment, causing the RSI line to enter the oversold zone.
The Simple Moving Average (SMA) of the RSI line exhibited a crossover in July 2023, moving above it, indicating a sudden decrease in pricing strength. As of now, the RSI line is at 41, while its SMA stands at 49.
EMAs: In May 2023, the 50-day Exponential Moving Average (EMA) crossed above the 200-day EMA, signifying a bullish momentum in price actions. Presently, Fever-Tree stock price is seeking support and aiming to surpass the 50-day EMA at £1,323, with the 200-day EMA positioned just below at around £1,279.
Conclusion
The future behavior of Fever-Tree stock price is likely to align with its 50-day EMA. Presently, there appears to be a struggle between the bulls and bears, influencing the direction of the price movement, with the 50 EMA acting as a pivotal midline.
At the moment, the bulls seem to have an upper hand as the price resides within the demand zone. However, should the stock’s trend turn bearish from this point, there’s a possibility of a significant downward movement, potentially surpassing its initial support level of £1,304.
Technical levels
Support: £1,304, £1,182
Resistance: £1,446, £1,512
RSI: 40
50 EMA: £1,322
200 EMA: £1,279
Disclaimer
The views and opinions stated by the author, or any people named in this article, are for informational purposes only. They do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
