After a sharp rise in the end of July, the Vodafone stock (LON: VOD) managed to get back above its 200-day EMA, this way sparking hope in the eyes of new investors. The price is now moving sideways, roughly between the 145.50 and 153.90 levels. We can see that the stock is forming somewhat of a flag pattern, which tends to be a continuation pattern in the direction of the prevailing trend (in this case the upside). That said, in order to examine higher areas, we need to wait for a confirmation break of one of our key resistance levels, hence why we will stay cautiously-bullish for now.
A strong push through the 153.90 barrier, marked by the highest point of July, would confirm a forthcoming higher high and could attract more buying interest, which may help lift the price higher. This is when we will examine the 158.50 obstacle, a break of which could set the stage for a test of the 165.20 hurdle, marked by the high of December 13th, 2018. VOD might stall around there, or even correct back down a bit. But if the price continues to float above the 153.90 hurdle, this may be seen as a positive sign and the buying could resume, leading the stock above the 165.20 zone and aiming for the 171.70 level, marked by the highest point of November 2018.
Alternatively, a drop below the 145.50 hurdle would also place the price below the 200-day EMA, which could lead the stock to a larger correction, given that it is still trading above a medium-term upside support line taken from the low of May 23rd. VOD may continue moving slightly lower, possibly targeting the 135.20 obstacle, a break of which could send the price to the aforementioned upside line for a test, which may provide additional support.
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