Shares of ITM Power plc (LON: ITM) fell 6.61% to hit a crucial support level erasing a massive chunk of the gains made in late June amid a spike in investor interest towards hydrogen energy stocks.
Today’s decline brings the hydrogen power company’s shares to the crucial 400p support level, which could trigger another rally phase if it holds over the coming days.
Investors seemed unimpressed by the fact that Royal dutch shell opened a 10MW hydrogen electrolyser plan in Germany, a project worth €20 million ($23.72 million), in which ITM Power is a partner.
ITM Power is also set to benefit from the unveiling of an ambitious multilateral climate strategy by the European Union that targets to enable the region to achieve its net-zero carbon emissions goal by 2030.
The EU will unveil the proposal later today. Still, many expect negotiations around the policies to take years before the member countries can arrive at a compromise set of policies to be implemented across the eurozone.
Still, the consortium led by Shell is working on plans to expand the 10MW hydrogen electrolyser plant to a 100MW capacity, which could generate additional revenues for the company as a partner in the project.
The block of 27 EU countries has lowered its emissions by 24% from 1990 to 2019, but they need to lower the emissions by a broader percentage.
ITM Power shares have broken below the 400p support level and are headed towards the 355p level. This could pave the way for the 319p level, which has been in place for much longer.
However, I would not buy ITM shares at current prices as I would wait for some bullish daily candles above support before jumping in.
*This is not investment advice.
ITM Power share price.
ITM Power shares fell 6.61% to trade at 402.8p, falling from Tuesday’s closing price of 431.30p.
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