Rolls-Royce share price remains under pressure this month, moving from the year-to-date high of 1,195p in September to the current 1,040p. It is hovering near its lowest level since August this year. So, will the stock rise or fall in December this year?
Rolls-Royce share price technical analysis
The daily timeframe chart shows that the Rolls-Royce stock price has pulled back in the past few months, moving from the year-to-date high of 1,195p in September to the current 1,040p.
A closer look shows that the stock has formed a double-top pattern, a common bearish reversal pattern in technical analysis. It has now moved below the important support level at 1,090p, its lowest point in October.
The stock has now moved below the 50-day Exponential Moving Average (EMA), a sign that bears are gaining control for now.
It has also moved below the Supertrend indicator. The last time this indicator turned red was in April when it dropped from a high of 806p in March to a low of 555p in April this year.
The Relative Strength Index (RSI) and the Percentage Price Oscillator (PPO) have continued falling, with the PPO falling below the zero line. Also, the RSI is nearing the oversold level at 30.
Therefore, the most likely scenario is where it continues falling as sellers target the next support level at 1,000p. A move below the support 1,000p will point to more downside.
On the flip side, a move above the key resistance level at 1,090p will invalidate the bearish outlook, and point to more upside in the near term.
Rolls Royce Holdings has potential catalysts ahead
Rolls-Royce Holdings’ business is doing well, helped by the robust demand of its key products and services.
The most recent trading statement showed that its business was doing well, with wide-body orders rising. It recently received orders from companies like IndiGo and Malaysia Airlines.
The company’s defense business is also doing relatively well as demand from countries in Europe and the United States rise.
Most importantly, the company has become a major player in the artificial intelligence (AI) industry, where its power generators are used to provide backup power to companies in the data center industry. It now plans to launch a new fast-start generator that will become available in 2028.
Most importantly, the company’s SMR business has substantial potential as demand for nuclear energy continues rising. It is now in the final stage of the Swedish competition to select a nuclear energy partner.
It has already won a deal with the UK government, and is in the process of getting regulatory approval in the United States, where it seeks to compete with companies like NuScale and Oklo. This business has a lot of potential and analysts anticipate that it will get more deals, especially in the manufacturing and data center industries.
Additionally, the company has continued to improve its balance sheet, which has received strong ratings from companies like S&P Global and Moody’s. If has also continued to repurchase stock, a trend that may continue over time.
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