Rolls Royce under pressure after the release of 1H trading update
Nicolas Suiffet July 9, 2020 8:49 AM
Rolls Royce, the engineering group, posted a 1H trading update.
Rolls Royce, the engineering group, posted a 1H trading update:
"Our Civil Aerospace business has experienced a significant reduction in demand due to the effects of COVID-19. Widebody engine flying hours fell by approximately 50% in the first half, compared to the prior year period with an approximate 75% decline in the second quarter.
As a result of our cash mitigation actions and supply chain management we expect our rate of cash consumption to significantly reduce in the coming months, resulting in a full year free cash outflow of approximately £4 billion."
From a chartist point of view, the stock price remains in a bearish trend and is approaching from the lower end of its short term consolidation range at 235.5p. Prices remain capped by the 20WMA currently at 248p. The weekly RSI is reversing up from its oversold area but remains below 50%. A break below 235.5p would call for a new down move towards 130p. Alternatively, a rebound above 348p would call for a test of the upper end of the trading range at 427p.
Source: GAIN Capital, TradingView
Disclaimer: GAIN Capital UK Limited (trading as "Forex.com") is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, Forex.com does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by Forex.com or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although Forex.com is not specifically prevented from dealing before providing this material, Forex.com does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
For further details see our full non-independent research disclaimer and quarterly summary.