Is this trend a good trading opportunity?
Will Sainsbury turn, or will it continue to rise towards 320p late Nov highs?
- Sainsbury shares are +14.7% since early January.
- Now trading at 291p (at the time of writing)
- Will the strong positive momentum continue?
- Shares -1.8% from 2018 highs; +13% from 2018 lows; +9.8% year-to-date.
- 10 Jan: Sainsbury’s outperformed the FTSE and other supermarkets last year on ASDA tie-up optimism.
- Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal
Trading Sainsbury – An Example
Let’s say the trend appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of Sainsbury using a CFD, at the current price of 291p. To do this, you need £2,000.
Let’s assume the Sainsbury trend continues to 320p late Nov highs (+9.9%). Your profit would be £990, from your initial investment of £2,000.
Conversely, let’s assume you open the above position, and place a stop-loss at 4% from the current price. Sainsbury falls 4% and hits your stop-loss. Your loss would be £400.
This is provided for information purposes only. It should not be taken as a recommendation.