A range trading opportunity for you?
Will Ocado break higher, or will it fall back to 737p lows again?
- Ocado shares are trading in 737-868p range since early October.
- Bounced back from resistance zone 4 times, most recently this week.
- Now trading 838p (at time of writing)
- Will the pattern repeat itself, testing previous lows?
- Shares -27.6% from 2018 highs; +116.1% from 2018 lows; +111.1% year-to-date
- 19 Nov: Kroger investing $55m in first ‘shed’ in Cincinnati as part of Ocado’s first major US deal
- Source: Dow Jones, Bloomberg, FT, Company News
Trading Ocado – An Example
Let’s say you like the range, you think it’s heading back towards 737p again. You decide to sell exposure to £10,000 worth of Ocado using a CFD, at the current price of 838p. To do this, you need £2,000.
Let’s assume Ocado falls back to 737p (-12%). Your profit would be £1200, 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. Ocado 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.