Heineken profit falls – key resistance at 80.7E

Heineken, a brewing company, announced that 1Q net income slumped 68.6% on year to 94 million euros and beer volume fell 2.1% organically.

FOREX 8

Heineken, a brewing company, announced that 1Q net income slumped 68.6% on year to 94 million euros and beer volume fell 2.1% organically. The company stated: "The initial impact of the Covid-19 crisis is visible in the volume performance of this quarter and is expected to worsen in the second quarter of 2020. The second half of the year is also expected to be impacted, as lockdowns may be lifted but the impact on the economy is likely to remain. Heineken will deviate from its dividend policy and will not pay an interim dividend following its half year results in August 2020."


From a chartist point of view, the stock price has landed on a horizontal support near 68E and is posting a rebound. The danger is not yet over as prices are approaching from the upper end of a short term consolidation range near 79.5E. Former bearish gap plays a resistance role at 80.7E. In addition, the daily Relative Strength Index (RSI, 14) is capped by a declining trend line. The 50-Day simple moving average currently at 83.9 is heading downward. 

As long as 80.7E is resistance, the bias remains bearish. A new down move is likely towards the lower end of the trading range at 68E. 

Alternatively, a break above 80.7E would deliver a bullish signal and would call for a rise towards 90E (overlap).

Source : GAIN Capital, TradingView

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