Will Morrisons break support, or will it rise again back to 255p?

• The Morrisons range has developed since early October.
• Shares bounced off 244p support zone 8 times, most recently today.
• Now trading 244.8p (at time of writing).
• Will the pattern repeat itself, testing previous highs?
• Shares -5.9% from 2018 highs; +25.2% from 2018 lows; +11.4% year-to-date
• 6 Nov: Morrisons Q3 like-for-like sales ex-fuel +5.6% vs Q2 (Retail +1.3%, Wholesale +4.3%), slowing versus +6.3% in Q2. Like for like transactions +0.2%, items per basket -1.5%
• Source: Bloomberg, FT, Reuters, DJ Newswires

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Trading Morrisons – An Example

Let’s say you like the Morrisons range, you think it’s heading back towards 255p again. You decide to buy exposure to £10,000 worth of Morrisons using a CFD, at the current price of 244.8p. To do this, you need £2,000.

Let’s assume Morrisons rises back to 255p (+4.2%). Your profit would be £420, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 2% from the current price. Morrisons falls 2% and hits your stop-loss. Your loss would be £200.

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