๐ $ASC.L (ASOS PLC) quick technical overview
๐ฏMid-term price target ยฃ36, upside 45%
1. Following a double-digit surge yesterday, ASOS has finally broken above its 50-day moving average. Volume was 3x typical average volume, which is a very strong bullish momentum.
2. According to the mean reversion theory, the nearest short- to mid-term price target is its 200-day moving average, also known as annual average.
3. It is unlikely the price will reach these levels very quickly though as the stock has been under severe pressure following sudden exit of the CEO and eroding margin. However, it is finally starting to look like a trend reversal.
4. The price is trading within Ichimoku cloud, which will provide some resistance. Once the price breaks above it. the bullish momentum should continue with strength.
5. It is also worth pointing out that MACD oscillator has been in bullish divergence for a while and it is starting to materialise.
Asos competitors: $NXT.L (Next)$MKS.L (Marks & Spencer)$FTCH (Farfetch)$ZAL.DE (Zalando)
๐ It is worth diversifying one's portfolio not only across sectors, but also across geographies. European market has delivered smaller returns compared to S&P over the last 2 years, European stocks are trading at lower multiples and pay out more generous dividends. Hence, they provide not only diversification, but also upside benefits.
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