Gilead Sciences has recently double-bottomed and rallied sluggishly for the past month. This week however, there is back-to-back good news for the former Wall Street darling. With the decline of their hepatitis C franchise, GILD has been expanding into oncology and bolstering their HIV pipelines to makeup for lagging sales in their once stellar hepatitis core-business. Just this week Kite, a recent Gilead acquisition, reported positive data in their phase I trial for Human Papillomavirus (HPV) related cancers and is in trials to expand the use their approved Yescarta CAR-T therapy from lymphoma to hematologic cancers. This poised Gilead for breakout of the down-channel it has been in following the acquisition of Kite, which was met with enthusiasm, and perhaps some over-exuberance from investors.
Today, Gilead announced they have entered into a research collaboration and license agreement with Hookipa Biotech AG. Gilead will own exclusive rights to Hookipa's TheraT and Vaxwave arenavirus immunization technologies for hepatitis B virus (HBV) and human immunodeficiency virus (HIV). This gave the stock the momentum to break out of the down-channel with good volume today, finishing with a very strong candle on the daily chart. Look to enter positions on any profit taking after open tomorrow, but don't be afraid to buy into strength on this one.
Channel resistance breakouts tend to break out to 100% of the size of the channel width. https://www.investopedia.com/articles/trading/08/trading-breakouts.asp As such, I have cloned and placed the Chanel width to the break out point to arrive at my price target of $80, which is just above the 0.618 Fibonacci level. Fibonacci resistances tend to bend and snap back, allowing nimble traders or those with well placed limit-sell orders to take profits a few points higher, before a danger of rejection off the resistance line. As such, these are two indicators that the price will: 1) achieve the price target and 2) allow for profit taking and a slightly lower re-entry point for the swing traders or active traders bullish on Gilead.
Stops can be placed fairly aggressively, as there should be good support at the point of the breakout, and if this fails, the breakout is invalidated. On the chart I have placed a stop at $69.30, though, if you enter this trade it is your responsibility to manage your position and risk.
The engineered T-cell therapy has the potential to disrupt oncology. Gilead, with its massive war chest and history as a disruptive, industry-leader is well positioned to be at the forefront of this cancer treatment revolution. Please note, this is a short-term trading price target. The potential for Gilead to rally much higher is certainty there, that's what I note in the above paragraph that re-entering after a pullback from the channel breakout / 0.618 Fibonacci target.
As always, the responsibility for managing your position is your own. I am not a financial adviser nor is any content in this post intended to be financial advice. The information presented is my opinion, based on tools I have learned from others sharing their opinions and my experience in the markets. I share these ideas to generate discussion and have others critique my analysis because, as always, I am still learning. With that in mind, the outcome could be quite different than what I am predicting and this is for informational purposes only. It should not be considered financial or investment advice of any kind. Readers should consult with a financial or investment professional to determine what may be best for their individual needs.
Today, Gilead announced they have entered into a research collaboration and license agreement with Hookipa Biotech AG. Gilead will own exclusive rights to Hookipa's TheraT and Vaxwave arenavirus immunization technologies for hepatitis B virus (HBV) and human immunodeficiency virus (HIV). This gave the stock the momentum to break out of the down-channel with good volume today, finishing with a very strong candle on the daily chart. Look to enter positions on any profit taking after open tomorrow, but don't be afraid to buy into strength on this one.
Channel resistance breakouts tend to break out to 100% of the size of the channel width. https://www.investopedia.com/articles/trading/08/trading-breakouts.asp As such, I have cloned and placed the Chanel width to the break out point to arrive at my price target of $80, which is just above the 0.618 Fibonacci level. Fibonacci resistances tend to bend and snap back, allowing nimble traders or those with well placed limit-sell orders to take profits a few points higher, before a danger of rejection off the resistance line. As such, these are two indicators that the price will: 1) achieve the price target and 2) allow for profit taking and a slightly lower re-entry point for the swing traders or active traders bullish on Gilead.
Stops can be placed fairly aggressively, as there should be good support at the point of the breakout, and if this fails, the breakout is invalidated. On the chart I have placed a stop at $69.30, though, if you enter this trade it is your responsibility to manage your position and risk.
The engineered T-cell therapy has the potential to disrupt oncology. Gilead, with its massive war chest and history as a disruptive, industry-leader is well positioned to be at the forefront of this cancer treatment revolution. Please note, this is a short-term trading price target. The potential for Gilead to rally much higher is certainty there, that's what I note in the above paragraph that re-entering after a pullback from the channel breakout / 0.618 Fibonacci target.
As always, the responsibility for managing your position is your own. I am not a financial adviser nor is any content in this post intended to be financial advice. The information presented is my opinion, based on tools I have learned from others sharing their opinions and my experience in the markets. I share these ideas to generate discussion and have others critique my analysis because, as always, I am still learning. With that in mind, the outcome could be quite different than what I am predicting and this is for informational purposes only. It should not be considered financial or investment advice of any kind. Readers should consult with a financial or investment professional to determine what may be best for their individual needs.