Return of Optimism for German Telecom Industry Shares?

Deutsche Telekom, Germany's telecommunications giant, has been experiencing a rollercoaster ride in the stock market lately. The company's stock reached a low of 29.38 euros, the lowest level since early April, following a disappointing quarterly report. However, a recovery was observed shortly after, filling the gap created after the earnings release by mid-August.

The recovery was not met with significant enthusiasm from investors, but the price of the Deutsche Telekom stock has remained above the low of 29.38 euros. Despite this, the stock's price remains below its pre-earnings release level.

The RSI (Relative Strength Index) has entered the zone above 50, signaling buying momentum, and the MACD (Moving Average Convergence Divergence) and RSI indicators have been supporting an upward movement since mid-June, with rising values. A break above the 200-day moving average (SMA200) could be imminent for the Deutsche Telekom stock, indicating a potential sustained turnaround.

The Deutsche Telekom's reported revenue was just below market expectations, despite a disappointing German business. However, the strong performance of the company's US subsidiary has led to an increase in the company's annual targets.

Analysts remain bullish about Deutsche Telekom, with nearly 90% recommending buying the stock. The average price forecast for Deutsche Telekom stock stands at 38.27 euros. Analysts recommending a hold (Kaufhaltung) position for Deutsche Telekom stock have set average price targets around 38.05 to 38.76 EUR for 2022, with firms like DZ Bank maintaining a "buy" rating at about 38 EUR, reflecting moderate growth expectations amid mixed operational results.

The downward trend since the March high remains in focus, but the recovery of the stock following the low in late April and the reclaiming of the 50-day moving average (SMA50) could signal a potential reversal of this trend. The low was reached shortly after the US tariff announcements, and the sustained turnaround could occur if the trendline in the 32.60 euro area is broken.

In conclusion, while Deutsche Telekom's stock has been facing challenges, the overall sentiment among analysts remains positive. The recovery, though not met with significant enthusiasm, has shown signs of potential sustained growth, making it a stock worth keeping an eye on for investors.