Will Centrica break support, or will it rise again back to highs of 156p?

• Centrica has shallow rising support since mid-May
• 3 bounces off support zone, latest off 141p today.
• Now trading 143p (at time of writing).
• Will the pattern repeat, the shares climbing back towards 156p?
• Shares -13.56% from 2018 highs; +15.5% from 2018 lows; +4.3% year-to-date.
• 6 Nov: UK Regulator Ofgem says UK Energy Price cap to start from Jan. 1
• 31 Oct: The utility company appointed Charles Berry as new Chairman
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading Centrica – An Example

Let’s say you like the Centrica chart and you think the price is heading back towards 156p again. You decide to buy exposure to £10,000 worth of Centrica using a CFD, at the current price of 143p. To do this, you need £2,000.

Let’s assume Centrica rises back to 156p (+9%). Your profit would be £900, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 3% from the current price. Centrica falls 3% and hits your stop-loss. Your loss would be £300.

This is provided for information purposes only. It should not be taken as a recommendation.