The GBp 495.25 support area, currently tested, might facilitate a technical rebound. The company’s fundamentals could validate this scenario.

From a fundamental viewpoint, the company has an important growth potential, as shown by analysts perspectives. In the same time, net margins should progress as well from 6% to 7.4% anticipated for 2016.

Currently, the stock is oversold and trading in a bearish trend in the short term. This momentum is reversed upon contact with the GBp 495.2 area. Majestic Wine should be able to confirm its increase in the next trading sessions thanks to the support currently tested. This is a trading opportunity in order to anticipate a technical rebound towards GBp 534.5 and by extension towards GBp 590.

Considering technical and fundamental elements, it seems to be an appropriate timing to immediately take a long position in Majestic Wine in order to benefit from the GBp 495.2 support area. A first target price will be the GBp 534.5 resistance, ie a potential of 5.5%. A stop loss order will be placed under the mid-term support currently tested. Only a crossing of GBp 534.5 would validate a bullish trend in order to aim a higher target price.