Is this trend a good trading opportunity?

Will Vodafone turn, or will it continue falling to 8-year lows of 124p?

• The chart shows the Vodafone price action in 2018.
• Shares in a 9-month downtrend; now at 151p.
• Company is burdened by sluggish growth prospects.
• High levels of debt (€40bn) incurred to finance large M&A deals also weighs on shares.
• Recent CEO change represents a potential risk.
• Shares now trading at 8-year lows; -35.5% from 2018 highs; -10.5% year-to-date
• Shares fell 6.6% in the past week. Will this negative momentum continue?

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Trading Vodafone – An Example

Let’s say the trend appeals to you, you think it’s likely to continue. You decide to sell exposure to £10,000 worth of Vodafone using a CFD, at the current price of 151p. To do this, you need £2,000.

Let’s assume the Vodafone trend continues to May 2010 low of 124p (-17.8%). Your profit would be £1,780, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 10% from the current price. Vodafone shares rise 10% and hit your stop-loss. Your loss would be £1,000.

This is provided for information purposes only. It should not be taken as a recommendation.