A range trading opportunity for you?
Will HSBC break higher, or will it fall back to 600p lows again?
- The HSBC falling range exists since early 2018
- Bounced back from falling highs trendline 6 times, most recently this week.
- Now trading 662p (at time of writing)
- Will the pattern repeat itself, testing previous lows?
- Shares -15.4% from 2018 highs; +13.3% from 2018 lows; -13.6% year-to-date
- 5 Dec: HSBC issues €2.25bn new bonds
- 4 Dec: US financials sell-off on concerns over global trade and signals of US recession
- Source: Dow Jones, Bloomberg, FT, Company News, AlphaTerminal
Trading HSBC – An Example
Let’s say you like the range, you think it’s heading back towards 600p again. You decide to sell exposure to £10,000 worth of HSBC using a CFD, at the current price of 662p. To do this, you need £2,000.
Let’s assume HSBC falls back to 600p (-9.4%). Your profit would be £940, 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. HSBC rises 5% and hits your stop-loss. Your loss would be £500.
This is provided for information purposes only. It should not be taken as a recommendation.