H&M Sales dropped 50% in Q2 – key resistance at 170

Hennes & Mauritz, the clothing-retail company, reported that 2Q net sales dropped 50%

Downtrend 2

Hennes & Mauritz, the clothing-retail company, reported that 2Q net sales dropped 50% on year to 28.66 billion Swedish krona, while online sales were up 36%. The company said: "The sales development during the second quarter was severely affected by the Covid-19 situation. At present approximately 900 stores, representing around 18 percent of the group's 5,058 stores, are still temporarily closed. The H&M group's total sales during the period 1 - 13 June this year decreased by 30 percent in local currencies compared with the same period in 2019."

From a chartist’s point of view, prices retraced to the resistance level in a pullback rally during an ongoing downtrend. The daily Relative Strength Index (RSI, 14) reversed down from its overbought territory. Readers may want to consider opening short positions below the 61.8% Fibonacci resistance level at 170SEK with targets at 130SEK and 117.6SEK (May 14 low). Alternatively, a push above 170SEK would call for a reversal up trend with 190SEK and 200SEK as targets. 

Source: GAIN Capital, TradingView


More from Equities

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) 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, City Index 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 City Index 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 City Index is not specifically prevented from dealing before providing this material, City Index 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.