Will Ocado continue falling, or will it rise again back to 1006p Monday’s highs?

• Ocado shares -5% from Monday’s highs, already bounced +1.1% from lows
• Online retailer’s investments jumped in 2019 at the expense of profits.
• Investors were also disappointed with no new comments on the M&S tie-up.
• Now trades 966.9p (at time of writing).
• Shares -4.2% from 2019 highs; +1.1% from 2019 lows; +24% year-to-date.
• Can the stock recover to recent highs?
• Source: Dow Jones, Bloomberg, FT, Company News, AlphaTerminal

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Trading Ocado – An Example

Let’s say you feel that the stock is a bargain and you think could bounce back towards recent high of 1006p. You decide to buy exposure to £10,000 worth of Ocado using a CFD, at the current price of 966.9p. To do this, you need £2,000.

Let’s assume Ocado recovers back to 1006p Monday highs (+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 2% from the current price. Ocado 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.