Will FirstGroup turn, or will it continue to rise beyond 85.5p?

• The chart shows the price action for FirstGroup since end-November.
• The shares have broken above a resistance trendline at 84p to trade 85.5p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• Shares -29.4% from 2018 highs; +10.9% from 2018 lows; +2.5% since end-17.
• 13 Nov: Reiterates FY guidance, sees stable operating earnings, Greyhound review complete, New CEO
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Click to enlarge

Trading FirstGroup – An Example

Let’s say the breakout appeals to you, you think it’s likely to continue to . You decide to buy exposure to £10,000 worth of FirstGroup using a CFD, at the current price 85.5p (at time of writing). To do this, you need £2,000.

Let’s assume the FirstGroup trend continues upwards to 92p late Nov highs (+7.6%). Your profit would be £760, 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. FirstGroup 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.