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by Darius Anucauskas

Unilever Stock Is On Shaky Grounds

Since peaking at the 5330 level in September, which was also the all-time high, the Unilever Plc stock (LON: ULVR) drifted lower and is now trading below its 200-day EMA. At the same time, the price is balancing below a short-term downside resistance line drawn from the high of September 12th. But after hitting a support zone, at 4500, the stock is struggling to move below it. Despite that, we still see more possibility for ULVR to drift lower, but before we could get comfortable with that idea, we need to see a daily close below the above-mentioned support zone first. This is why we will stay cautiously-bearish, at least for now.

A daily close below the 4500 area, marked by the low of October 22nd, would confirm a lower low, which may spook new buyers from entering at this stage. We will then aim for the 4430 obstacle, a break of which may set the stage for a test of the 4313 level, which acted as a good support zone between the end of March and mid-April.

Our oscillators, the RSI and the MACD, are somewhat in support of the above-discussed idea. The RSI sits below 50 and currently points a bit lower. The MACD, despite moving from its lows in the end of October, is pointing slightly lower and is once again testing its trigger line. 

Alternatively, if the price starts rising again, breaks the aforementioned downside line and closes a daily candle above the 4701 barrier, this could attract more buyers into the game. This move would also place ULVR back above its 200-day EMA, which could also be seen as a positive. The stock might then travel to the 4897 zone, which could stall it for a bit. That said, if there is still enough interest in the stock among potential new investors, another push higher and a break of the 4897 hurdle may lift the price to the 4970 level, marked by the high of September 27th.

Unilever daily


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