Drax
A trading opportunity for you?
Will Drax break support, or will it rise again back to 444p?
- Drax has rising support since April.
- Now trading 386p (at time of writing).
- Will the pattern repeat itself? Will the shares bounce off support again?
- Shares -10.6% from 2018 highs; +77.3% from 2018 lows; +41.4% year-to-date.
- Drax is an electricity utility company, using coal and biomass
- Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal, CMC Markets
Trading Drax – An Example
Let’s say you like the Drax chart and you think the price is heading back towards 445p again. You decide to buy exposure to £10,000 worth of Hunting using a CFD, at the current price of 386p. To do this, you need £2,000.
Let’s assume Drax rises back to 445p (+15.3%). Your profit would be £1530, 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. Drax falls 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.