In the past few sessions, Saipem’s prices have started to drop again, returning to € 2.194, the lowest since the beginning of last June.
Saipem, daily chart. Source: Bloomberg
From a graphic point of view, it is evident that after the restart during the second half of March 2020, the courses started a slight restart, stopped by the trend line obtained by connecting the highs of 10 and 20 March 2020.
In the downward impulse of the last few days, prices have put pressure on the trendline drawn with the lows of 16 March and 22 May 2020, and now seem to be aiming for the horizontal level test at 2.095 euros, expressed by the top of 18 March.
A violation of that level would have the opportunity to pose difficulty keeping annual lows, at 1.7735 euros. On the contrary, if prices were to raise their heads again, there would be the possibility of expecting a return to € 2.50 in the first place, and then move on to a new test of the upward trend line mentioned above.
Operational strategy on Saipem
Operationally, strategies of a long nature could be assessed in the event of the support being maintained at € 2.095. The stop loss would be located at 1.96 euros, while the main target would be 2.30 euros. The final target would instead be located at € 2.50.
For this type of operation, the ISIN NL0014921728 Turbo Long certificate and 4.15 lever.
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