Persimmon share price ended trading with a loss of 2.61% on Tuesday, to trade at 2650p. The homebuilder’s share price is trying to find its way back to an uptrend, following four months on the downtrend between June 8th and October 8th. Some investors may be understandably jittery about the company’s fortunes heading into the low-season winter.
Persimmon on the right track
The winter season historically experiences low house sales, but Persimmon’s performance this year should create traction for growth. For instance, in its latest three-month review for the period between July and October, it reported a 16% growth in private reservations above the pre-pandemic levels.
Notably, the reported growth was still lower than the 38% growth reported for the same period in 2020. Nonetheless, it still signals that the company is on the right track. Furthermore, the recent growth comes despite the supply chain disruptions experienced this year.
Going forward, Persimmon (LSE:PSN) has projected that it will sell 10% more homes in 2021 than in 2020. The company has also exuded confidence that it has enough capital to cushion it against any unforeseen building cost inflation. Based on these assessments, the near-term performance of the company should be headed up.
Technical analysis for Persimmon share price
Persimmon share price has been on an uptrend over the past month, as shown by the ascending channel. It has experienced intermittent retracements, but the growth trajectory is likely to be sustained. Over that period, the RSI has grown from 33 to the current 46. However, the momentum has been on the decline over the past two days, with the RSI dropping from 53 to 46.
If the momentum weakens further, the price is likely to decline to the first support at 2609p. If it breaches that mark, the next support could be at 2537p.
However, if the momentum strengthens, the bulls may attempt to break the first resistance at 2713p.Beyond that point, the next target is likely to be at 2751p.
