Is this breakout a good trade for you?
Will AB Foods turn, or will it continue to rise beyond 2180p?
- The chart shows the last 14 months’ price action for AB Foods
- The shares have broken above a resistance level at 2138p to trade 2176p (at time of writing).
- The ‘trend is your friend’. Will it continue?
- Will the shares rise back to the channel ceiling at 2500p?
- Shares -25.7% from 2018 highs; +7.4% from 2018 lows; +6.5% year-to-date.
- 3 Jan: RBS says Next’s Christmas sales cheer bodes well for rivals
- 17 Dec: UK clothing retailers drop After ASOS cuts sales view
- 7 Dec: AB Foods reiterates group outlook for current financial year
- Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal
Trading AB Foods – An Example
Let’s say the breakout appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of AB Foods using a CFD, at the current price of 2176p. To do this, you need £2,000.
Let’s assume the AB Foods trend continues upwards to 2500p (+14.9%). Your profit would be £1490, from your initial investment of £2,000.
Conversely, let’s assume you open the above position, and place a stop-loss at 5% from the current price. AB Foods breaks lower, falling 5% and it hits your stop-loss. Your loss would be £500.
This is provided for information purposes only. It should not be taken as a recommendation.