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by Darius Anucauskas

Waiting For Renault SA Stock To Exit The Range

The Renault SA stock (EPA: RNO) has declined severely in the past couple of years, going from around the 100-euro mark, which was reached in March 2018, to around the 13-euro zone in March of this year. A similar decline happened during the previous financial crisis of 2008-2009, where the share price was hit heavily, dropping from around the 122.00 area to a 10-euro level. But, as we can see, once the economy started getting better again, RNO climbed higher as well. If we apply the same logic this time, there could be a possibility to see a prolonged move higher in the long run. However, from the short-term perspective, we will stay cautious and preferably on the neutral side. The fact that, from around the end of March, the share price continues to float within a range, supports our neutral stance. That range is roughly between the 15.75 and 19.80 levels.

In order to start considering higher areas in the medium-term, a break of that upper bound, at 19.80, would be needed. That’s when we may start aiming for the 22.05 hurdle, which is the high of March 10th. RNO could stall there for a bit, but if the buying is still strong, the next possible target that could be reached, might be near the 23.64 level. The level marks the high of March 6th.

The RSI and the MACD seem to support our idea of staying neutral, at least for now. The RSI keeps on moving around 50 and the MACD is not moving anywhere away from its zero and trigger lines.

On the downside, a drop below the lower end of the aforementioned range could open the door for further declines, as such a move would confirm a forthcoming lower low. RNO could drift to the 14.70 obstacle, a break of which may lead the share price to the 12.75 area, marked by the current lowest point of this year.  



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