Will Rentokil Initial turn, or will it continue to rise beyond 326p?

• The chart shows the last 3 weeks’ price action for Rentokil.
• The shares have broken above a resistance level at 324p to trade 326p (at time of writing).
• The ‘trend is your friend’. Will it continue?
• Shares -9.8% from 2018 highs; +24.9% from 2018 lows; +2.4% year-to-date.
• 4 Dec: Rentokil Initial expects small cash surplus after completion of pension buy-in
• 18 Oct: Rentokil consensus wont be affected by CMA findings according to Jefferies
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Click to enlarge

Trading Rentokil – 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 Rentokil using a CFD, at the current price of 326p. To do this, you need £2,000.

Let’s assume the Rentokil trend continues to 341p recent highs (+4.6%). Your profit would be £460, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 2% from the current price. Rentokil breaks lower, falling 2% and it hits your stop-loss. Your loss would be £200.

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