Will ASOS continue falling, or will it rise again back to 5166p December highs?

• ASOS shares have fallen over 8% today to trade 4108p (at time of writing)
• Broker Morgan Stanley downgraded ASOS today, setting the target price at 3200p.
• Sector peer Superdry has also been downgraded today by Berenberg.
• Shares close to -19% in 1 week.
• Shares -46.9% from 2018 highs; +1.7% from 2018 lows; -38.55% year-to-date.
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

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Trading ASOS – An Example

Let’s say you feel that the stock is a bargain and you think it could bounce back to recent highs of 5166p. You decide to buy exposure to £10,000 worth of ASOS using a CFD, at the current price of 4108p. To do this, you need £2,000.

Let’s assume ASOS recovers back to 5166p December highs (+25.7%). Your profit would be £2570, 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. ASOS 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.