A range trading opportunity for you?
Will Ferguson break support, or will it rise again back to 5200p?
- The Ferguson range has developed since mid-November
- Bounced off 4710p support zone 3 times, most recently this week.
- Now trading 4826p (at time of writing)
- Will the pattern repeat itself, testing recent 5200p highs?
- Shares -27.6% from 2018 highs; +1.9% from 2018 lows; -9.5% year-to-date.
- 4 Dec: Davy says Ferguson’s looks more interesting after Q1 update; Canaccord says US Q1 augurs well
- Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal
Trading Ferguson – An Example
Let’s say you like the Ferguson range, you think it’s heading back towards 5200p again. You decide to buy exposure to £10,000 worth of Ferguson using a CFD, at the current price of 4826p. To do this, you need £2,000.
Let’s assume Ferguson rises back to 5200p (+7.7%). Your profit would be £770, 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. Ferguson 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.