After peaking in the beginning of September 2019, the Remy Cointreau stock (EPA: RCO) reversed to the downside and drifted further south until it found decent support near the 107.70 hurdle on January 8th. The share price rose sharply after that, which led to a break of the medium-term downside resistance line taken from the high of September 4th. Although we are seeing a bit of weakness in today’s trading activity, this could be a temporary correction, before another leg of buying, hence why we will take a cautiously bullish approach for now.
The stock may drift a bit lower and test the 111.70 zone, which is marked near the low of December 4th and near the high of December 30th. If this area provides good support for RCO, the buyers might re-enter the field and push the price back to last week’s high, at 118.00. If this time that barrier fails to withstand the bull-pressure and breaks, this could open the door to some higher levels. We will then examine a potential move to the 120.80 obstacle, a break of which might set the stage for another push up, aiming for the 123.70 zone. That zone marks the high of November 15th.
Our oscillators, the RSI and the MACD, seem to be in support of the above-mentioned scenario. The RSI is above 50, but currently points slightly to the downside. The MACD, after bottoming in the beginning of January, has now moved higher and is now flirting with the zero line.
If the price, by any chance, drops below the current lowest point of January, at 107.70, this might force a few existing investors to dispose of some of their existing positions. Such actions might force the stock to fall to the 104.30 obstacle, which is near the highs of December 18th, 2018, and near the high of January 30th, 2019. If there are still no new buyers at that area, a further slide may bring RCO to the 98.80 level, marked by the low of January 28th, 2019.
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