Will Babcock turn, or will it continue to fall towards 472p?

• Breakdown below 507p to trade 501p  (at time of writing).
• The ‘trend is your friend’. Will it continue down towards 472p?
• Shares -13.0% from 2019 highs; +6.2% from 2019 lows; +2.5% year-to-date.
• 26 Feb: Panmure cuts earnings outlook; shares hit by Brexit charges
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

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Trading Babcock – An Example

Let’s say the breakdown appeals to you, you think it’s likely to continue to 472p . You decide to sell exposure to £10,000 worth of Babcock using a CFD, at the current price 501p (at time of writing). To do this, you need £2,000.

Let’s assume the Babcock trend continues down towards 472p (-5.8%). Your profit would be £580, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 3% from the current price. Babcock breaks higher, rising 3% and it hits your stop-loss. Your loss would be £300.

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