Unlike businesses such as Flight Centre (FLT) and Webjet (WEB), Corporate Travel (CTD) provides travel solutions, as their name suggests, for corporate customers.
“Corporate Travel (CTD) has obviously been hit hard by the pandemic, but they clearly leveraged to a recovery in travel,” Michael said.
“Recent lockdowns in Australia are a problem of course, but CTD also derives revenue from North America and Europe, which are opening up quicker.
“What catches my attention on the CTD chart that you can see here is the fact that despite lockdowns in Australia, the share price hasn’t fallen away. This sign of strength is a positive. “Looking a bit closer, I see a classic “cup and handle” formation. This is the same formation that I have spoken about a few months ago with stocks like Wesfarmers (WES) and Mineral Resources (MIN). It is where CTD formed a peak in March, fell away, but then rebounded back.
“From June to August, it then sat just under this high point, which enabled the sellers to get out, but because the share price hardly fell, it shows that it was met with some pretty good buying.
“Finally, yesterday, it pushed through this resistance (circled), this wall of selling. This means that with the market now looking beyond the current lockdown, CTD shares are likely to rally from here,” Michael concluded.
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