Burberry share price has staged a strong comeback since the start of the new year. The BRBY stock is hovering more than 43% above its lowest level since September. It has gained more than 15% in its year-to-date price. It has a total market capitalization of £9.074 billion.
Burberry share price has been on a slow upward trajectory for the past few weeks amid a gloomy economic outlook. The stock has climbed by more than 17% in the past month and 26.57% in the past three months.
The British luxury fashion house edged 3.30% higher on Wednesday after announcing rising sales. Burberry recorded a rise in its third-quarter sales despite a covid-driven slump in China and a hard-hitting economic climate globally.
Data by Burberry shows that the firm’s revenue for the three months to December 31 rose 5% to £756 million, compared with the previous year. Store sales in China dipped 23% during the aforementioned period on the back of Covid-19 restrictions. Outside mainland China, Burberry recorded a sales growth of 11%.
Despite the rise in sales, the firm’s sales for the third quarter were weaker than expected following the Covid disruption in China that slashed customer demand. Strong demand from Japan and Europe was not enough to offset the hit from mainland China. China is the world’s second-biggest luxury market after the United States.
Burberry Share Price Outlook
At the time of writing, the Burberry share price was trading 0.39% lower at 2349p. It hit an intraday high of 2382p before pulling back. The BRBY has remained above the 25-day and 50-day moving averages. It is also hovering above the 50-day and 200-day exponential moving averages. Its Relative Strength Index (RSI) has moved to the overbought zone.
I expect the Burberry stock price to continue rising in the near term as China eases covid-19 restrictions. If this happens, the next resistance levels to watch will be 2435p and 2500p. On the flip side, a move below the support at 2156p will invalidate the bullish view.