Can pandemic ‘loser’ turn into a winner?

TL;DR

TUI, a German travel operator, has experienced a decline in share value due to the pandemic but shows potential for a double bottom and a strong rally.

Transcript

hello it's john burford with chart of the week for monday the 25th of october and i'm covering a really bombed-out share here tui tui is a german travel operator and of course it's been in the news because of the travel restrictions that have been imposed since the start of the pandemic which is about almost two years ago now but back then we had u... Read More

Key Insights

• 💁 TUI's shares have experienced a significant decline due to travel restrictions, but the double bottom formation suggests the possibility of a rally.
• 🙃 Factors such as the lifting of restrictions and increased vaccinations could contribute to the upside potential in TUI's share price.
• 🛢️ Other recommended stocks include Tesla, EV battery and charging shares, Petrofak (oil-related), and the Sprott Physical Uranium Trust (uranium-related).
• 🤘 The Sprott Physical Uranium Trust shows bullish signs with a Fibonacci 62 retracement and a significant gap that remains unclosed, indicating potential for substantial growth.

Questions & Answers

Q: What has caused the decline in TUI's share price?

The travel restrictions imposed during the pandemic have had a major impact on TUI's share price, leading to a significant decline in value as bookings were delayed and canceled.

Q: What is the significance of the double bottom formation?

A double bottom formation suggests that TUI's shares have reached a bottom and could reverse upwards. The presence of a huge momentum divergence indicates the potential for a sharp and violent rally.

Q: What factors could contribute to the share price rally?

Several factors, such as the gradual lifting of travel restrictions and an increase in vaccinations, could encourage a rally in TUI's share price. These factors could lead to improved sentiment and a resurgence in holiday bookings.

Q: What are the potential price targets for TUI shares?

The first target for a potential rally in TUI's share price would be around the £5 region, followed by the £6 region. If the tailwind of restrictions being lifted continues, a much higher price could be seen by next summer.

Summary & Key Takeaways

• TUI shares have been heavily affected by travel restrictions since the start of the pandemic, resulting in a significant drop in value.

• With the shares currently at the same level as March 2020, there is a possibility of a double bottom formation, indicating a potential rally.

• Factors such as the lifting of restrictions and increased vaccinations could contribute to a sharp upward movement in TUI's share price.