Date: 12 Apr 2019

Bill McDermott, head of the German-based software company SAP, has announced that he intends to increase the market capitalisation of his company to €300 billion by 2023. With a current market capitalisation of around €122 billion, SAP is Germany’s most valuable listed company and the most reliable European software manufacturer in terms of sales.

The software group is currently in the middle of a restructuring phase. In the course of this, several thousand jobs are to be cut.

The news of strong market capitalisation has not yet been able to inspire investors.

A glance at the chart shows a six-month high on April 4 at just under €105. From this high, the price fell by around 5 percent within a few days and broke the upward trend line. Three days later, the price remains below its trend line.

The MACD histogram turned from positive to negative with the breach through the trend line. The MACD line is below its trigger line, and both lines are far apart.

The stock is currently trading just below the magic €100 mark. This zone may be decisive for the next few days, in whether the bulls intervene again or the bears drag the market further downwards.

On the downside, the ranges €96.90, €94.50 and €92.00 could support the stock.

If the bulls come back and sustainably overcome the magic €100, the first resistance areas could be at €101.68 and €104.00. If the stock can exceed the high from early April, then there could be another resistance zone at €106.30.

 

SAP.DE - daily chart. Source: ActivTrader

SAP.DE Daily Chart | Source: ActivTrader

 

Written by Daniel Schuetz, External Analyst

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