Safran share breaks through its support at €328.70 and declines by nearly 3%
In a CAC 40 down nearly 2% during the session, the aerospace engine manufacturer's stock posted one of the steepest declines on the index this Wednesday. The breach of the support threshold at €328.70 marks a notable technical deterioration, while CIC Market Solutions maintains a positive view on the stock.
A key support breached during the session, in a globally pressured Paris market
The Safran share loses 2.88% to €324.00 during the session, after closing at €333.60 the previous day. The stock broke through its support level at €328.70 downward without a rebound, and remains well below this level, which constitutes a sign of fragility for several weeks. The decline takes place in a difficult market context: the CAC 40 is down 1.84% during the session, driven notably by industrial and technology stocks. Over one month, the correction reaches 9.35%, confirming the pressure exerted since the peak in early August.
On the moving averages front, the stock is trading well below the 20-day MA at €345.66 (a gap of 6.27%) and the 50-day MA at €342.89 (a gap of 5.51%). Only the 200-day MA at €313.56 remains above the price, offering a potential floor to monitor if the decline were to continue. The RSI at 41, without reaching oversold territory, reflects progressive exhaustion on the buy side since the peaks.
CIC Market Solutions maintains its buy rating with a target of €378 this Wednesday
Despite the ongoing correction, CIC Market Solutions maintained its buy rating on the stock this Wednesday, with an unchanged price target of €378.00. Compared to the current price of €324.00, this scenario represents an upside potential of nearly 17%. The recovery remains, however, conditional on the stock returning above its short-term moving averages, which are situated more than €18 above the current price. Over the week, the decline stands at 2.29%, while the three-month performance remains positive at +10%, illustrating the distance traveled since the spring low.
The VIX rises 7.84% during the session, a sign of increased nervousness in the markets, in a geopolitical context marked by tensions in Ukraine and a Brent surge close to $100. The next resistance for Safran is located at €363.60, a level that appears distant as long as the stock does not recapture its moving averages. The 200-day MA threshold at €313.56 constitutes the next downside reference point in case the movement continues.
