Will Sainsbury turn, or will it continue to rise to 288p recent highs?

• Shares +9% in less than 3 days.
• 19 Mar: Supermarket said CMA’s report on Sainsbury-ASDA merger had errors.
• Sainsbury promised the merger deal would deliver cost savings to consumers.
• Now trading 242p (at the time of writing).
• Will the positive momentum continue towards 288p recent highs?
• Shares -18.4% from 2019 highs; +8.9% from 2019 lows; -8.85% year-to-date.
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

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Trading Sainsbury – 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 Sainsbury  using a CFD, at the current price of 242p. To do this, you need £2,000.

Let’s assume the Sainsbury  trend continues to 288p recent highs (+19%). Your profit would be £1900, 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. Sainsbury falls 5% and hits your stop-loss. Your loss would be £500.

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