Is this breakout a good trade for you?

Will Lloyds Banking turn, or will it continue to rise beyond 59p?

• The chart shows the last month’s price action for Lloyds
• The shares have broken above a previous support line at 58.5p to trade 59p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• Will the shares rally back to recent 62p highs ?
• Shares -18.9% from 2018 highs; +3.2% from 2018 lows; -13.4% year-to-date.
• Higher interest rates and the recent rise US and global bond yields is supportive of Banks
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading Lloyds – 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 Lloyds using a CFD, at the current price of 59p. To do this, you need £2,000.

Let’s assume the Lloyds trend continues upwards to 62p (+5.1%). Your profit would be £510, 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. Lloyds breaks down, 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.