Market News & Analysis
Which supermarket is a buy?
Fiona Cincotta May 13, 2020 11:04 PM
Morrisons reported a solid set of results this week, with its online business doubling in size. It also introduced a telephone delivery service and teamed up with Deliveroo to deliver groceries in 30 minutes by courier. This is just one example of how a supermarket has responded to the unprecedented challenge of coronavirus boosting Q1 revenues.
Ocado – the purely online supermarket is worth some consideration. The online boom in grocery sales is expected to bring long term gains for Ocado.
Ocado has the distinct advantage of automated warehouses making scaling up online orders simple and without significant extra cost. The current climate has shone a light on Ocado’s high tech warehouse, with demand for these warehouses expected to pick up internationally. So far customers include US Kroger and France’s Groupe Casino.
Levels to watch
Ocado trades firmly above its 20, 50 & 100 SMA on 4 hour chart at its all time high of 2090p A bullish chart, although firmly in overbought territory. A pull back could provide a good buying opportunity.
Resistance can be seen at 1841p (20 sma ) prior to 1700p (high 28th April and 50 sma)
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