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This week we look at a sell signal on Gold Fields. The RSI is falling and more importantly, the MACD is below its signal line. It is also trading below its 20 day moving average (MA), but still above the 50 day MA.
In order to profit from declines in share prices you need to go short. It means you sell shares you don’t own and buy them back later after the price has fallen, making a profit. You can only sell short with CFDs (see what CFDs are and how to open an account). The first Support line indicates a 12% profit and the Resistance line indicates a potential loss of 7% where your stop-loss should be set. The risk/reward ratio is therefore acceptable.