Lovisa Holdings Share Price Starts the Move Back Up (ASX:LOV)

Today we look at the Lovisa Holdings Ltd [ASX:LOV] share price.

The Australian-based jewellery retailer is up 5.89% at the time of writing the LOV share price was trading at $6.47.

Like most retailers Lovisa suffered an enormous fall in their share price with the onset of the COVID-19 virus, declining 81.20% from February to March 2020.

ASX LOV Share Price Chart 1 - Lovisa Shares

Source: Optuma

What’s been happening at Lovisa

With a global network of stores, Lovisa was forced to temporarily close most of them to come into line with the government containment initiatives in each region.

At the same time the company announced the deferral of dividend payments for six months.

Since the March announcement, much has changed for Lovisa. On 2 July 2020 the company announced it will be progressively reopening some of its stores from mid-April.

Stores in Australia will be the first to open. With a progressive approach to the rest of their operations, stores in the UK will be the last to open at the end of June.

Coupled with this, was the news that Lovisa’s online business was able to deliver 256% growth on prior year during Q4.

Positive signs for the company.

Looking forward for Lovisa

The future is still looking uncertain, with the COVID-19 virus rattling around the globe, no one really knows what will happen in the long term.

Exiting the Spanish market, as they were unable to come to terms with landlords, and stronger balance sheet than last year may be playing a role.

Let’s have a look at the chart:

ASX LOV Share Price Chart 2 - Lovisa Shares

Source: Optuma

From the low in March 2020 to the high in May 2020, the price retraced 50%, just below the historical support level of $5.64 before starting to move up again. The move back up in price took place on higher volume, a potentially healthy sign.

Should the price continue its up momentum then the levels of $6.97 and $7.92 may provide future resistance.

On the downside if the price were to fall, then levels of $5.66 and $4.12 may become the focus.

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Regards,

Carl Wittkopp,
For Money Morning

 


Carl Wittkopp writes for Money Morning and has a diploma in Financial Planning. He specialises in technical analysis.

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