Sunday, September 22, 2013

Best Biotechnology Stocks: $ALXN, $MRK, $AMGN, $EBS

A backlog of stocks to cover, links offer redirects to fundamental analysis I've done at the Motley Fool; starting with Alexion Pharmaceuticals ($ALXN).  July's breakout was substantial, and subsequent trading validated the surge with the defense of $105.  Prepare for follow through on a push above $117.30. It may be possible to run a stop as close of $112.50 when the break happens.


Next up is Merck ($MRK) and Cyberonics ($CYBX). Merck hasn't broken $48.50 resistance, but is positioning itself nicely for the move. A stop on a loss of $47.00 is a good starting point once the breakout occurs.

Cyberonics is looking a little worrisome: the breakout has failed and is back inside the sideways consolidation. It has so far held $50.16 support, with $47.93 the last line of defense, but breakout failures are typically followed by substantial corrections. The 'Death Cross' between the 20-day and 50-day MAs is offering a lid of supply - which when broken - will offer a buying opportunity.



Amgen Pharmaceuticals ($AMGN). The break of $113.34 has so far held up. Pullbacks offering buying opportunities, particularly if they stay top side of $113.  The advance has been scrappy, so stop placement will require some room: the breakout gap or 50-day MA look best in this regard.


Emergent Biosciences ($EBS). Inched a break of $18.86 on low volume.  Loss of 50-day MA would be a cautious stop placement; short term traders can place stops on loss of $18.86.


All stocks worthy of the watchlist.

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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com.
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