I have been following and holding position in FLGT for past few weeks now, while every article here and elsewhere on the web point to FLGT being very bullish (frankly, past 2 weeks I only came cross 1 or 2 twits or post shorting FLGT), investor haven't been able to enjoy any return beyond 120 level. So, what is going on one might ask?
FLGT has 2.8B market cap as of now, according to latest data from Nasdaq 1 billion of it is held with institutions (more than 1/3). Recently we have been through some turbulence in the market. The rotation in and out of sectors now happens on daily and weekly bases and be honest with you I don't see much of stability one way or the other in this market. Many of these institutions (especially smaller ones), have to capitalize on small gains from FLGT in order to maintain liquidity to work around other positions which may not be in good shape at the moment. This behaviour is obvious by how FLGT recently moves independent of the market and health care sector.
Secondly, since the run up to 122 level, the volume in FLGT is oddly low. This indicates that FLGT is being traded on back of retail traders rather than institutions. Investors (not day traders and swingers) still have their hands in their pocket and waiting for improvement or collapse in the market or clear up or down trend in FLGT. It goes for both bears and bulls, as daily short volume is also flat!
Stock prices are driven by supply and demand, volatile stocks attract short term traders and companies with solid foundation attract investors. FLGT is both volatile (at least for now) and has solid fundamentals. Hence the holders of the stock are not selling, and day traders really keep the stock within certain levels upon volatility in stock price and at key price levels. So, I have decided to hold some of my FLGT shares for long term and swing trade with other portion of my shares between key level. At this time FLGT RSI is holding key levels, however it is clear that we are in a giant side way base rather than an uptrend. Previously there was break through at 120 resistance level however it was not sustainable. On this upcoming run up, FLGT needs to hold above 125 resistance level to establish bullish up trend. It doesn't seem achievable under current market conditions. However, market changes drastically these days and health care sector has started to attract some traction recently. So anything can happen.
FLGT has 2.8B market cap as of now, according to latest data from Nasdaq 1 billion of it is held with institutions (more than 1/3). Recently we have been through some turbulence in the market. The rotation in and out of sectors now happens on daily and weekly bases and be honest with you I don't see much of stability one way or the other in this market. Many of these institutions (especially smaller ones), have to capitalize on small gains from FLGT in order to maintain liquidity to work around other positions which may not be in good shape at the moment. This behaviour is obvious by how FLGT recently moves independent of the market and health care sector.
Secondly, since the run up to 122 level, the volume in FLGT is oddly low. This indicates that FLGT is being traded on back of retail traders rather than institutions. Investors (not day traders and swingers) still have their hands in their pocket and waiting for improvement or collapse in the market or clear up or down trend in FLGT. It goes for both bears and bulls, as daily short volume is also flat!
Stock prices are driven by supply and demand, volatile stocks attract short term traders and companies with solid foundation attract investors. FLGT is both volatile (at least for now) and has solid fundamentals. Hence the holders of the stock are not selling, and day traders really keep the stock within certain levels upon volatility in stock price and at key price levels. So, I have decided to hold some of my FLGT shares for long term and swing trade with other portion of my shares between key level. At this time FLGT RSI is holding key levels, however it is clear that we are in a giant side way base rather than an uptrend. Previously there was break through at 120 resistance level however it was not sustainable. On this upcoming run up, FLGT needs to hold above 125 resistance level to establish bullish up trend. It doesn't seem achievable under current market conditions. However, market changes drastically these days and health care sector has started to attract some traction recently. So anything can happen.
Trade active:
Well, FLGT officially broke its down trend upper band, which is a very good news. Tech stole the spot light today and spy made all time high. All of this is very good news for FLGT. Does it mean you will wake up on Monday and find FLGT trading at 130? I would say extremely unlikely. However, if you missed out on buying FLGT at 90 levels. From now to 107 is a very good place to start. I have lightened my position today a little bit and planning to sell more at 112. Just to diversify my holding and next levels will be 125 and on ward! Healthcare as a sector is not impressive right now, therefore rapid movement toward mid 100s shouldn't be expected! FLGT is and has been on watch list of day traders and make drastic moves in either direction throughout the day. Therefore, my suggestion to participant is to keep your position reasonable so you do not panic out of your position, or miss out on potential upward trend. Also, the hype about FLGT is dying down a little bit and it is expected that this trade may take few months to fully pan out, hence I predict that we might see less of 10 to 20 percent daily movements! However, I welcome ease in volatility as radical movements usually are not sustainable! "slow and steady wins the race"
Trade active:
Looking at FLGT Monthly chart we can see that last month the price ranged from 80-123 dollars. We are still slowing down from massive sell off in Feb and volatility is evaporating out of FLGT. It is good and also bad. It is good because any resistance that gets broken going forward is much more likely to be sustainable. It is bad because it will take much more time to go back up to 120 levels. Clearly day trader and swing traders have lost interest in this stock and now it is in hands of investors. No one is shorting it for a quick buck anymore and no one is buying it in chucks and just to make it crash once it hits one of the major resistance. Going down to weekly time frame FLGT is really testing the lower band of the uptrend and it can break out to lower resistance if this week the stock doesn't gain some momentum. if we go lower, It may entice short seller to come forward and the stock can drop to 80 levels. However, so far the trend haven't been breached. At daily the RSI Trend is intact however, it is at mercy of buyers to stay relevant. The volume has been lower past two weeks however, there were some significant buying at 90 levels. This week is very decisive as market is ripping higher on behalf of tech joining up with defensive sectors. However we will see an episode where market will start pulling back and growth stocks including FLGT will be a safe harbor for investors. However, in order to achiever 120 level, FLGT needs to hold above 90 for next few days!
Trade active:
Well today FLGT has broken out of its lower band of its short-term uptrend channel. The next level for FLGT historical long-term trend is at mid 70s. This support trend was last time tested in late December and very unlikely for the stock to breakdown through that level, however anything in stock market is possible. Enough with the bad news. The good news is that there was notable accumulation of the stock at 85 level today. It has been a week for FLGT to see such high volume and most of the volume was recorded at 85 level rather early sell off period. Last time this happened a week ago the stock went from $88 to $102! I have added some at 85 and will sell some at higher price if the FLGT doesn't change trend! In order for FLGT to get back to uptrend and pays its investor it needs to remain above $110 for at least a week! Right now, FLGT is testing a double bottom and if it holds the rebound will be rather nice, otherwise investors should hold this stock only on back of its phenomenal fundamentals. To my experience stocks with strong fundamentals will take months to payout. So, any short-term gain will not be fruitful if FLGT breaks its current price and most specially if it goes below $75.00!
Comment:
Today's movement: note the upstroke in volume at 85 level!
Comment:
Well today was a much-welcomed uptick in the volume in FLGT. Even though it is too early to be certain if FLGT will start picking up heavily from here, it is definitely a change in trend and break out of a 4 day long base. There is a major resistance at 94 which FLGT needs to clear to make it to 100 level!
Comment:
It has been long time since I gave an update on FLGT. FLGT, is one of those companies who made lots of money during the pandemic. I think the Covid testing revenue will dry up in a year or two; however, it is an understatement to say it will take FLGT with it. The company is very diverse, rapidly expanding in different markets and even though COVID testing is the bulk of their income it is not their only income stream. There are two ways to make money on FLGT either hold a comfortable number of shares for long term investment or day trade it. I do not see it in the cards that it will go to 140-150 level any time soon!
Not a Financial Advise, I may have an open position in this underlying.
