Thales Continues Its Correction Following Deutsche Bank Downgrade
Thales falls by 3.12% to 254.90 euros this Thursday mid-session, continuing the correction started after Deutsche Bank's downgrade citing uncertainties over the French defense budget. The stock displays an RSI in the overbought zone at 78, suggesting a technical pause after an annual increase of 75.49%.
Extended Decline Amidst Budget Uncertainties
Thales has experienced a decline of 3.12% to 254.90 euros this Thursday, January 15th at mid-session, extending the correction that began on Tuesday after Deutsche Bank downgraded from 'buy' to 'hold' with a reduced target of 280 euros. The bank justifies its revision by the lack of imminent catalysts and growing uncertainties regarding the French defense budget, as 20% of the group's sales depend on French military spending, in a context where Parliament did not adopt a budget in December 2025. This situation could constrain the 2026 defense spending to 2025 levels, a scenario described as catastrophic by the French Minister of Defense. The stock is now significantly below the resistance threshold of 270.20 euros briefly surpassed earlier in the week. Despite this drop of more than 8 euros in three sessions, Thales still maintains a spectacular annual performance of 75.49% and shows a progression of 5.07% over seven days. This correction follows a surge that had driven the stock to historic highs, fueled by geopolitical tensions and promises of increased defense budgets in Europe.
Technical Analysis Highlights Overbought Conditions
From a technical standpoint, Thales' stock is in a marked overbought configuration which partly justifies the ongoing correction. The RSI indicator reaches 78, a level significantly above the critical threshold of 70 that traditionally delineates overbought zones. This situation suggests that after the strong recent gains, a phase of consolidation or technical respite was necessary. The price is now at 254.90 euros, 15 euros below the major resistance threshold at 270.20 euros. However, the MACD maintains a favorable setup, with a MACD line at 10.52 well above the signal line at 7.60, confirming that the underlying trend remains bullish despite today's decline. The stock also trades well above its key moving averages: 236.74 euros for the MM50 and 244.49 euros for the MM200, forming a solid ascending channel for several weeks. This robust technical structure, combined with major support at 219.50 euros, offers a comfortable safety margin to investors, even though the high volatility at 10.19% over a month reflects the magnitude of recent movements and calls for short-term caution.
