Centrica share price technical analysis: extremely overbought
Invezz
Published Sep 18, 2023 14:37
Updated Sep 18, 2023 15:12
Centrica share price technical analysis: extremely overbought
Centrica (LON:CNA) share price has been in a strong upward trend this year, making it one of the best-performing companies in the FTSE 100 index. It has risen in all the past 11 weeks and is now sitting at the highest level since February 2017. The shares have surged by more than 502% from the lowest level in 2020.
Centrica stock price has surged, helped by the company’s performance. The most recent results showed that the total adjusted EBITDA surged from over £1.6 billion in 2022 to £2.3 billion. Its operating profit jumped to over £6.4 billion. It also benefited from a lower tax rate of 28% compared to the previous 48%.
Centrica shares have also jumped as the company has continued returning money to shareholders. It increased its interim dividend by 33% and extended its share repurchase program to £1 billion.
Centrica stock price weekly analysis/h2
The weekly chart shows that the Centrica stock price has been in a strong bullish trend this year. It has jumped in the past 11 straight months. The stock has moved to the 61.8% Fibonacci Retracement level.
It formed a golden cross pattern on December 19th last year. In technical analysis, a golden cross is usually a bullish sign. It also moved above the important resistance level at 141.10p, the highest point in June 18th and the 50% Fibonacci Retracement level.
Meanwhile, the Relative Strength Index (RSI) and the Stochastic Oscillator have moved to the overbought level. Therefore, there is a likelihood that the Centrica stock price will have a brief retreat to the key support at 141.10p.
Centrica share price daily analysis/h2
Meanwhile, on the daily chart, we see that the Centrica stock price has been in a strong bullish trend. As with the weekly chart, it has consistently remained above the 50-day and 200-day moving averages. Also, the RSI and the Stochastic Oscillator have moved to the extremely overbought level. It has also soared above the Ichimoku cloud.
Centrica share price has also risen above the ascending trendline shown in black. This trendline connects the lowest level since December. Therefore, the outlook for the shares is bullish, with the next level to watch will be at 200p. In the short term, however, the stock will likely retreat slightly as some investors start to take profits.
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Written By: Invezz
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