Will Rio Tinto break lower, or will it rise to 4016p again?

• The Rio Tinto trading range developed since late September.
• Shares bounced back from support zone around 3548p, most recently today.
• Now trading 3568p (at time of writing).
• Will the pattern repeat itself, testing previous highs?
• Shares -21.7% from 2018 highs; +2.7% from 2018 lows; -8.9% year-to-date
• 26 Nov: Rio Tinto is defensive in a downturn and well-placed to cash in on a recovery, according to analysts Jefferies.
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal, CMC Markets

Click to enlarge

Trading Rio Tinto – An Example

Let’s say you like the Rio Tinto range, you think it’s heading back towards 4016p again. You decide to buy exposure to £10,000 worth of Rio Tinto using a CFD, at the current price of 3568p. To do this, you need £2,000.

Let’s assume Rio Tinto rises back to 4016p (+12.5%). Your profit would be £1250, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 6% from the current price. Rio Tinto falls 6% and hits your stop-loss. Your loss would be £600.

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