Is this breakout a good trade for you?

Will Greggs turn, or will it continue to rise beyond 1113p?

• The chart shows the last 6 months’ price action for Greggs
• The shares have broken above a resistance line at 1082p to trade 1113p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• Will the shares rise back to April 1273p highs?
• Shares -22.9% from 2018 highs; +15.0% from 2018 lows; -20.4% year-to-date.
• 9 Oct: Greggs’s improved 3Q margin performance encouraging says Goodbody
• 9 Oct: Greggs shares heat up as health push pays off says Makets.com
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading Greggs – 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 Greggs  using a CFD, at the current price of 1113p. To do this, you need £2,000.

Let’s assume the Greggs trend continues upwards to 1273p (+14.4%). Your profit would be £1440, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 5% from the current price. Greggs breaks lower, falling 5% and it hits your stop-loss. Your loss would be £500.

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