ZTE Corporation stock and other Chinese telecom equipment manufacturers increased substantially as major countries issued a joint statement endorsing guiding principles for the global 6G network development. However, a selling pressure came on the next day, raising a concern about the market momentum.
ZTE Spiked On 6G Development
The ZTE shares listed in Hong Kong closed 11% on Tuesday but formed a rebound immediately by 7.7%. The share surge occurred shortly after a declaration was made by the United States and nine additional nations endorsing the incorporation of privacy and national security principles during the construction of worldwide 6G networks.
The significance of these principles in promoting security, peace, inclusivity, and sustainability was underscored in the joint statement, which also urged stakeholders, governments, and organizations to come together in solidarity.
In addition to advancing 6G network research, development, and standardization initiatives, the signatories pledged to promote relevant policies in their respective countries and internationally.
Is 6G A Bullish Factor For ZTE?
To achieve near-instantaneous connections, the United Nations International Telecommunication Union envisions a network equipped with sophisticated sensing and artificial intelligence functionalities by the time 6G technology standards are fully developed in 2030.
ZTE has demonstrated active involvement in the investigation of 6G technology by publishing scholarly articles that delineate prospective application scenarios.
Recent research by China Galaxy Securities indicates that prototype testing and standard formulation are concurrently underway for 6G. Nations that have developed a strong foundation in preceding technological generations, most notably China, are positioned to reinforce their technological preeminence using advancements in 6G.
ZTE Stock Technical Analysis
In the daily chart of ZTE stock price, the current price hovers at the high volume level with a minor downside pressure. However, a bullish rebound is present above the dynamic 20-day EMA, where the near-term resistance is at the 17.62 level.
In the higher timeframe, the current monthly candle trades bullish but failed to make a stable pressure above last month’s higher. Moreover, the weekly price formed bullish closes for four consecutive candles, which could be a primary signal of a possible bullish breakout.
On the bullish side, an additional buying pressure with a trendline breakout could be a potential long opportunity. A daily candle above the 19.00 level could extend the upward pressure above the 24.20 resistance level.
On the bearish side, the existing bearish daily candle from the 17.62 level could result in a downside continuation. In that case, a bearish daily candle below the dynamic 20 day EMA might lower the price towards the 13.34 support level.
