Home » Technical Analysis » ITM Power (LSE:ITM): Bull Flag Could Lead To 40p Plus

ITM Power (LSE:ITM): Bull Flag Could Lead To 40p Plus


While there are several reasons to be excited regarding the fundamental prospects of ITM Power (LSE:ITM) at the moment, and to call the stock up accordingly, arguably the technicals here are the main attraction for would be bulls of this situation.

This is said on the basis of the latest charting configuration on the daily timeframe where for the beginning of December we are presented with a Bull Flag formation resting on the 200 day moving average at 27.43p.

The floor of the flag also ties in with the likely floor of a rising trend channel from February, backing the idea of near-term out performance. Indeed, the view at the moment is that while there is no  end of day close back below the 200 day line, and backed by a rising trendline in the RSI window, we should be treated to further significant upside for ITM Power shares over the next 4 to 6 weeks.

The favoured destination at this point is as high as the 2014 resistance line projection currently pointing at 43p, with the message being that only cautious traders would wait on a momentum buy trigger such as an end of day close back above the November 32.5p high before taking the plunge on the upside.  in the meantime, any weakness towards the  200 day moving average is regarded as a buying opportunity, especially as this would improve the risk / reward ratio of going long even more.

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