Is this trend a good trading opportunity?

Will BT turn, or will it continue to rise to April highs of 252p?

• The chart shows the BT Group price action over the past month.
• Shares in a 6-week uptrend from 216p August lows; now at 240p.
• Shares -15.3% from 2018 highs; +17.22% from 2018 lows; -11.4% year-to-date
• According to broker Berenberg (14 Sep), BT could benefit from the growth of interest rates (that improve its pensions scheme deficit), as well as the resolution to the Brexit negotiations.
• Recent interest from activist investors (e.g. Greenlight Capital) in splitting BT and Openreach is also helping shares bounce back from recent lows (15 Oct).
• In the last 3 weeks, the shares have risen over 7%. Will this momentum continue?

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Trading BT Group – An Example

Let’s say the trend appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of BT Group using a CFD, at the current price of 240p. To do this, you need £2,000.

Let’s assume BT Group trend continues to 252p April highs (+5%). Your profit would be £500, 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. BT Group 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.