My thinking on this current, bearish, gaining-strength down trend28 Jan 2021 20:34
Here's why I think the SP is currently on the longest bearish path since this bullish breakout commenced early last November.
Near the end of the first week in November, saw the release of the strange two-part analysts consensus update. The second part (revealed on the following Monday) revealed that all 3 years for revenue were like lined-up ducks with this year set to be the lowest achievements under all headings, but with each subsequent Y-O-Y showing cumulative increases (despite year 3, not quite back to the revenue achieved last year!)
Nonetheless it went down a storm, it sounded like "recovery under way" with the added push of Biden winning, Pfizer announcing a vaccine and so on; resulting in a massive push north in the SP the very next day on the Tuesday, as the SP set off on a helluva bullish trailblazer of an uptrend.
Then, just last week came the next consensus update, and the analysts had messed up the pleasing y-o-y cumulative increases in revenue and went back to the old 3 year V formation forecast, in that this year is still set to be the lowest so far, but year 2 to be even lower with a V shape jump back up in year 3.
With all 3 years within spitting distance in revenue amounts ££££'s, so essentially nil progress in revenue over 3 years - and a dip in the middle year.
(And it's that; that I think added fuel to this week's continuance of the downtrend IMO).
Unlike net profit which they continue showing as pleasingly cumulatively increasing.
Based on BT's analyst-beating achievements in net profit against the analysts forecast for both Q1 and Q2 I see no reason for BT to reverse that trend in Q3, so am expecting BT to once again smash the analysts net profit forecast and hopefully THIS TIME, in the middle of this bigger breakout - get duly rewarded, end this current bearish downtrend, as plenty of headroom for the SP, and yet still remain below fair value when measured against the huge disparity against the P/E ratio v the competition's averages awarded to them by the market.
That's the only way I see out of this down trend - next Thursday's Q3 actual results.
So scar it into your calendar - don't form any decisions you may regret, until next Thursday!
(Hopefully will have time next week to post some analysts forecast running total up to Q3 targets to beat, for use on the day)
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