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Carnival PLC (CCL) Shares Have Bounced off Resistance Twice, Can They Break Through It?

Updated: 19 Mar 2021

Shares of Carnival plc (LON: CCL) have bounced off the 1792p resistance level shown on the chart below twice this month as bears stepped in and pushed the price lower amid a slew of announcements from the cruise ships operator.

The cruise ship company recently announced that its P&O Cruises would only accept UK residents vaccinated against COVID-19 onto its summer cruises departing from Southampton between June and September to sail around the UK coast.

The company’s Princess Cruises and Holland America Line recently postponed sailing from Seattle to Alaska up to June 27th, including all roundtrip sailings between the two cities.

Carnival Plc’s shares are doing pretty well this year, given that they are up 25% since January and are up 91% over the past six months. However, the cruise ship company’s operations are still primarily on hold due to the coronavirus restrictions.

The company’s shares have pulled back twice from the 1792p resistance level shown below, but we cannot say that a downtrend has begun given that buyers have resisted the moves lower so far.

To understand the significance of the 1792 level, we have to look at the weekly chart, which shows that the resistance level has held since March 2020; hence, it is crucial.

A break above this level could signify the beginning of a new uptrend that could see Carnival shares rally up to their pre-pandemic levels, but nothing is ever that easy in the markets.

A move to the January 2020 highs of 3600p could take months to play out. Hence, traders should be patient with the company’s shares. We are likely to see the price gyrate around this level for a while before getting a solid breakout.*

Carnival Plc’s resumption of its cruise operations could provide the right impetus to its shares. Still, this eventuality relies heavily on how and when many countries will ease travel restrictions based on the ongoing vaccination campaigns' success.

*This is not investment advice.

Carnival Plc share price.

Tradingview chart of Carnival plc share price 19-03-2021

Carnival shares have been unable to break above the 1792p resistance level twice, are they headed lower?

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