Is this breakout a good trade for you?

Will Unilever turn, or will it continue to rise beyond 4,200p?

• The chart shows the last 2 weeks’ price action for Unilever.
• The shares have broken above resistance level around 4,061p to trade 4,111p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• Recent market turbulence and trade war fears are leading investors to buy defensive stocks like Unilever, supporting the breakout.
• Shares -11.5% from 2018 highs; +8.4% from 2018 lows; flat year-to-date.
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading Unilever – An Example

Let’s say the breakout appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of Unilever using a CFD, at the current price of 4,111p. To do this, you need £2,000.

Let’s assume the Unilever trend continues to 4,430p September highs (+7.7%). Your profit would be £770, 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. Unilever breaks lower, falling 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.