Will Drax break support, or will it rise back to 426p highs?

• 356-426p range; bounced off long-term rising support.
• Now trades 378p (at time of writing)
• Will the pattern repeat itself, rising back to 426p Oct/Nov highs?
• Shares -8.9% from 2019 highs; +9.4% from 2019 lows; -5.4% year to date
• 26 Feb: Citi says Drax 2018 Earnings in-line
• 8 Feb: Drax launches UK’s first carbon-capture project at biomass plant
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

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Trading Drax – An Example

Let’s say you like the range, you think it’s heading back towards 426p again. You decide to buy exposure to £10,000 worth of Drax using a CFD, at the current price of 378p. To do this, you need £2,000.

Let’s assume Drax rises to 426p (+12.6%). Your profit would be £1260, 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. Drax rises 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.