Is this breakout a good trade for you?
Will Rolls Royce turn, or will it continue to rise to Sept highs of 999p?
- Breakout above 901p to trade 906p (at time of writing).
- The ‘trend is your friend’. Will it continue towards 999p?
- Shares -18.4% from 2018 highs; +20.7% from 2018 lows; +9.2% year-to-date.
- 11 Jan: Rolls-Royce Trent 1000 woes receding says Jefferies
- 9 Jan: Rolls among Goldman’s top aerospace picks
- Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal
Trading Rolls Royce – An Example
Let’s say the breakout appeals to you, you think it’s likely to continue to 999p . You decide to buy exposure to £10,000 worth of Rolls Royce using a CFD, at the current price 906p (at time of writing). To do this, you need £2,000.
Let’s assume the Rolls Royce trend continues upwards to 999p Sept highs (+10.2%). Your profit would be £1020, 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. Rolls Royce breaks lower, falling 3% and it hits your stop-loss. Your loss would be £300.
This is provided for information purposes only. It should not be taken as a recommendation.