SAP confirmed 2020 outlook - Bullish but risky trend in place
Remy Gaussens July 27, 2020 10:30 AM
2Q total revenue edged up 1.2% to 6.74 billion euros including 2.04 billion of cloud revenue, up 20.3%.
SAP, a German software firm, reported that 2Q net income grew to 1.38 billion euros from 1.30 billion euros in the prior-year period, and non-IFRS operating profit was up 7.7% on year to 1.96 billion euros. 2Q total revenue edged up 1.2% to 6.74 billion euros including 2.04 billion of cloud revenue, up 20.3%. The Company reconfirmed its 2020 outlook. Also, the Company announced plans to take its data-analysis unit Qualtrics public through an IPO.
From a technical point of view, the stock price is trading close to its historical high reached last week, before Friday opening sharp correction. Yet, prices remain supported by their upward crossing 20 and 50-day moving averages. However, as the daily RSI is posting a bearish divergence, the risk of a downturn is relatively high thus a tight invalidation level around the 20-day moving average is warranted. As a consequence, traders may consider long position above 133.00 with a target at 150: 1.618 Fibonacci projection of March to May up leg. Alternatively, a downside breakout of 133 would trigger a bearish acceleration towards the former resistance area at 127.00 now acting as a support.
Source: GAIN Capital, TradingView
StoneX Financial Ltd (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.