Will GlaxoSmithKline turn, or will it continue to rise beyond 1648p?

• The chart shows the price action for GlaxoSmithKline since late November.
• The shares have broken above intersecting resistance trendline at 1475p dating back to mid-September.
• The shares are currently 1485p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• 4 Dec: Analysts at Wedbush say GlaxoSmithKline is likely to benefit from its $5.1bn acquisition of cancer-drug developer Tesaro in terms of technology and talent.
• Shares -10.9% from 2018 highs; +18.9% from 2018 lows; +12.35% year-to-date.
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Click to enlarge

Trading GlaxoSmithKline – An Example

Let’s say the breakout appeals to you, you think it’s likely to continue to 1648p. You decide to buy exposure to £10,000 worth of GlaxoSmithKline using a CFD, at the current price 1485p (at time of writing). To do this, you need £2,000.

Let’s assume the GlaxoSmithKline trend continues upwards to 1648p (+10.9%). Your profit would be £1090, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 4% from the current price. GlaxoSmithKline breaks lower, falling 4% and it hits your stop-loss. Your loss would be £400.

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