Will Croda turn, or will it continue to rise beyond 4840p?

• The chart shows the last month’s price action for Croda.
• The shares have broken above mid-October highs to trade 4842p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• Shares -11.9% from 2018 highs; +11.4% from 2018 lows; -9.5% year-to-date.
• Croda is a specialty chemicals company
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading Croda– An Example

Let’s say the breakout appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of Croda using a CFD, at the current price of 4842p. To do this, you need £2,000.

Let’s assume the Croda trend continues to 5327p October highs (+10.0%). Your profit would be £1000, 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. Croda breaks lower, falling 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.