Will Ocado turn, or will it continue to rise beyond 895p?

• The chart shows the price action for Ocado since August .
• The shares have broken above a resistance trendline at 850p to trade 895p (at time of writing).
• The ‘trend is your friend’. Will it continue towards August highs of 1129p
• Shares -24.5% from 2018 highs; +125.4% from 2018 lows; +13.4% year-to-date.
• 13 Dec: Ocado’s plans are coming together, but risk remains, says Interactive Investor
• 13 Dec: Ocado not getting credit for technology success, says Numis Numis
• 13 Dec: Ocado 4Q retail revenue growth in line with guidance
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Click to enlarge

Trading Ocado – 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 Ocado using a CFD, at the current price 895p (at time of writing). To do this, you need £2,000.

Let’s assume the Ocado trend continues upwards to 1129p August highs (+26.1%). Your profit would be £2610, 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. Ocado 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.