Will John Wood turn, or will it continue to rise beyond 670p?

• The chart shows the price action for John Wood since October.
• The shares have broken above a resistance trendline at 655p to trade 670p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• Shares -20.7% from 2018 highs; +23.3% from 2018 lows; +3.2% year-to-date.
• 3 Dec: Oil higher on 1) Russia ready to continue cooperating on production cuts, and 2) US-China trade detente
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Click to enlarge

Trading John Wood – An Example

Let’s say the breakout appeals to you, you think it’s likely to continue to 798p . You decide to buy exposure to £10,000 worth of John Wood using a CFD, at the current price 670p (at time of writing). To do this, you need £2,000.

Let’s assume the John Wood trend continues upwards to 798p Oct highs (+19.1%). Your profit would be £1910, 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. John Wood 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.