New hope or false dawn?

The drop in the share price of Dr Martens has been documented in a series of our blogs. We looked at the share on 30 January 2023 (Charting Disappointment in a Share) and on 14 November 2023 (Why do investors give up hope?). We noted that downside risk to 80p was clear on the charts and on 17 April 2024 (Disappointment in a share continues) 40p risk was discussed. The share price hit 49p in September 2024 and in April 2025 43p was touched. The share consolidated since then, but long-suffering shareholders were cheered by the bounce from 60p to just over 80p last week on the news that while the company is still having a tough time, they will be reducing discounts in key markets, look to control costs and are looking to better times ahead.

We look at charts in order to gauge investor sentiment and behaviour. Looking at the long-term chart (weekly, below with 13 and 50-week moving averages) shows the share price recently bouncing above the 50-week moving average with key resistance levels marked. The red line marks the 113p low from summer 2023 which is key to regain for any basing hopes. The flat purple line from May 2022 near 175p marks two key lows and congestive highs where the bounce in May 2023 ran out of steam.

The daily chart below (with 20, 60 and 250-day moving averages) shows gap resistance levels to watch. The near-term focus is on 94p from April 2024 and then 115p from November 2023. Gap theory in chart analysis can be useful in determining if sentiment has changed. Filling (and closing) gap resistance levels if seen would suggest that buyers are stepping up on rallies, not just on dips.

The rally in the share price last week could have triggered a double bottom pattern as well. These can be difficult to trade in ‘real-time’ and most books (or course lessons or YouTube videos or Insta/TikTok gurus) only show the patterns that worked in the past. In reality most potential double bottoms get swallowed up by bear trends. In this case? The two drops below 50p and the approach to the 40p risk target could have been ‘it’ for the downtrend in the share price. The potential double bottom midpoint is 80p, which has been regained. A simple extension target would look for gains towards 110p/115p. This is right in the middle of important trendline and gap resistance, which will make any probes of this area very interesting. 

Right now, watch pullbacks to see if demand picks up on dips. In the downtrend of the last few years, upswings were met with selling (supply). If this trend is changing, then downswings will draw out buyers (demand). The 250-day moving average (64p) will serve as a risk level to watch. Chart support ahead of this may be found at 77p to 71p.