Is this trend a good trading opportunity?

Will BP turn, or will it continue to gain momentum toward 593p July highs?

• The chart shows price action since early July.
• Currently trading at 583p (as of the time of writing).
• BP shares are -1.7% from 2018 highs; +26% from 2018 lows; +11.6% year-to-date.
• Shares are rising thanks to Brent Crude oil price reaching 4-year highs above $81/barrel
• Goldman Sachs says (14 Sep) BP is likely to hit a “cash flow sweet spot” next year thanks to strong earnings and largest-ever project pipeline.
• Shares in a 2-week uptrend (+8.4% in the last 2 weeks). Will the momentum continue?

Click to enlarge

Trading BP – An Example

Let’s say the trend appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of BP using a CFD, at the current price of 583p. To do this, you need £2,000.

Let’s assume BP trend continues to 593p 2018 highs. Your profit would be £170, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 3% below the current price. BP falls 3% and hits your stop-loss. Your loss would be £300.

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