Will Tesco break support, or will it rise again back to highs of 220.5p?

• Tesco has support at 190p with 2 bounces since late Nov 2017
• Now trading 190.9p (at time of writing).
• Will the pattern repeat, the shares climbing back towards recent highs of 220p?
• Shares -27.7% from 2018 highs; +1.5% from 2018 lows; -8.9% year-to-date.
• 6 Dec: Two former Tesco executives acquitted in fraud trial
• 19 Nov: Berenberg says UK supermarkets confident Brexit won’t mean food rationing
• Tesco is the biggest UK Supermarket; recently launched new discount Jack’s to compete with Lidl and Aldi
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Click to enlarge

Trading Tesco – An Example

Let’s say you like the Tesco chart and you think the price is heading back towards 220.5p again. You decide to buy exposure to £10,000 worth of Tesco using a CFD, at the current price of 190.9p. To do this, you need £2,000.

Let’s assume Tesco rises back to 220.5p (+15.5%). Your profit would be £1550, 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. Tesco 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.