After remaining on a free fall since mid-January 2022, Volkswagen Group stock (ETR:VOW) may have found a bottom at $186. The stock rose more than 5% on Wednesday after the automaker projected higher sales revenue, return on sales and operating profit in 2022.
The company banks on the deliveries of more electric vehicles in the second half of 2022 to grow the earnings as chip issues dissolve. The automaker confirmed a target of a 6% return on sales for 2023.
Volkswagen’s boosted outlook is signaling good fortunes for a company suffering from supply chain issues. Already, the company was facing struggles for sourcing parts due to sanctions imposed on Russia.
CEO Herbert Diess said that the automaker considered investments outside Europe to overcome the Ukrainian crisis. Following the guidance for 2022, VOW has embarked on a bullish move. But how high can it go?
VOW may have bottomed at $186 – $255 next?
Source – TradingView
At press time, VOW was trading at $220 and looking on its way up after hitting bottom. The bottom of $186, reached on March 7, coincided with an RSI reading of 31, signaling oversold conditions. The $186 level was also a support zone, with technical indicators pointing to a bullish reversal. At the current price, the 100-day RSI is joining support for VOW that could take the stock higher.
Concluding thoughts
VOW could rise up to $255 if the current bullish momentum continues. The stock found support at $186 after an accelerated sell-off but is now flashing a bullish reversal. At the current price, the stock is a hold up to $255, where it could face a potential resistance.
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