Today’s blog provides an analysis and trading opportunities for three biotech companies that trade on the NASDAQ exchange. The NASDAQ stock market is the second-largest stock exchange in the world by market capitalization, after the New York Stock Exchange.
Biogen Idec, Inc. is a global biotechnology company focused on discovering, developing, manufacturing and marketing therapies for the treatment of multiple sclerosis (MS) and other autoimmune disorders, neurodegenerative diseases and hemophilia.
The share price has been in a steady up trend with the recent formation of a bullish flag. There was a bullish breakout from the upper trend line of the flag yesterday. This is my trigger signal to go long. I will place my stops below the most recent pivot lows (indicated by the red line).
Endo Pharmaceuticals (ENDP)
Endo Health Solutions, Inc. is a U. S. based diversified healthcare company, which redefines healthcare value by finding solutions for the unmet needs of patients along care pathways for pain management, pelvic health, urology, endocrinology and oncology.
The chart shows a strong up trend for the past several months with recent side ways consolidation bounded by a resistance and support level. Yesterday saw a bullish breakout from the resistance level of $67.90 which is a clear signal trigger to enter a long position. Stops can be placed just below the support level of $63.20.
Mylan, Inc. is a generic and specialty pharmaceuticals company, through its subsidiaries, which develops, manufactures, markets and distributes pharmaceuticals.
Again like the previous two charts this share is in an up trend with recent consolidation in prices which formed a symmetrical triangle. The bullish breakout which occurred yesterday gives traders the opportunity to enter this trade on the long side with the expectation that the up trend will continue. Stops can be placed under the most recent low of $42.00.
Fortescue Metals Group Ltd (FMG) is an iron ore production and exploration company with assets located in the Pilbara region of Western Australia. FMG has a tenement holding of around 88,000 sq km. Fortescue currently holds reserves of over 2.2Bt of hematite ore within the region. FMG’s resource base currently stands at 15.6Bt, with H1FY13 total ore mined and ore shipment of 35Mt and 35.7Mt respectively. The stock is traded on the Australian Stock Exchange (ASX).
The share price has enjoyed a good run for the past three months in line with the rally seen in the broader financial markets. The stock chart below provides clarity and my trading technical perspective.
The stock touched a 12 month low of $2.80 in July and has since rallied 65% to reach a 6 month high of $4.80 on September 11th. The price has since consolidated over the past 2 weeks to form a bullish flag formation.
Today there was a clear breakout from the upper trend line of the flag as I have shown on the chart as the breakout.
For this trade I will be looking to enter tomorrow at the midpoint of today’s bullish candle between $4.60/65. My stop loss will be placed below the most recent low of $4.42. A long term target of $5.35 is achievable based on the long term resistance level shown on the chart.
The Australian dollar has taken a beating relative to the major currencies over the past 6 months. Much of this decline was due to the negative fundamental data as a result of the mining slow down and the interest rate cuts made by the Reserve bank to help stimulate a flagging Australian retail industry.
The past two months of trading has seen the Australian dollar stabilize and stem the falls of May to June. Wednesday saw the announcement from the US Federal Reserve Chairman Mr Ben Bernanke that stimulus policy will remain unchanged. This sent US and foreign stockmarkets rising and had a positive flow on effect for the Australian dollar.
The chart below shows my technical perspective and the reasons why I think the Australian dollar is primed to rise further.
The price action shows a downtrend from May to July. Price then stabilized and has consolidated sideways to form an inverse head and shoulders formation. I have highlighted this on the chart as the 3 orange rectangles.
The resistance level of 0.9320 was broken strongly on Wedneday which indicates momentum has turned for the Australian dollar and should continue to rise from here.
I will be looking to enter on a retracement back down to the resistance/support level of 0.9325. I am looking for a target of 0.98 over the ensuing weeks.
The Australian dollar has not has a good few weeks. It has been heavily sold off against all the major currencies. At some point the sell off will be exhausted and buyers will then see an opportunity to start buying the Aussie dollar.
Looking at the weekly chart below of the Australian dollar against the Japanese yen cross (AUDJPY) a sell off has occurred over the past 2 months from the April highs of 106.00 to the current level of 90.00. Looking back over the past 6 years it is clear that this price point has acted as an area of support in 2007/08 and then later an area of resistance on 3 occasions over a three year period from 2010-12.
I see the current price action as being an ideal area to Buy the AUD against the Yen as the sell off has probably been overdone and a rally is now possible.
I would place stops below 88.00 as any further drop in prices below this level would invalidate this setup. Targets would be 94.00 if enter was achieved at 90.00. (click on chart for zoom)