Is this breakout a good trade for you?

Will Berkeley Group turn, or will it continue to fall beyond 3,279p?

• The chart shows the last 9 months’ price action for Berkeley Group.
• The shares have broken below twin support levels around 3,450p to trade 3,299p (at time of writing).
• Broken below September 2017 lows at 3,463p.
• Recent profits warning from peer house-builder Crest Nicholson is supporting the breakdown.
• Weakness in the London and South-East UK housing market is helping shares maintain downward momentum.
• The ‘trend is your friend’. Will it continue?
• Will the shares fall back to 3,164p July 2017 lows?
• Shares -21.6% from 2018 highs; +3% from 2018 lows; -21.3% year-to-date.
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading Berkeley Group – An Example

Let’s say the breakdown appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of Berkeley Group using a CFD, at the current price of 3,299p. To do this, you need £2,000.

Let’s assume the Berkeley Group trend continues downwards to 3,164p (-4%). Your profit would be £400, 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. Berkeley Group breaks higher, rising 5% and it hits your stop-loss. Your loss would be £500.

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