Array BioPharma Seems to Be in a New Uptrend

 | Sep 08, 2017 | 8:14 AM EDT
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Array BioPharma Inc. (ARRY) has made a nice-looking bottom formation the past five months. The longer-term weekly chart and the Point and Figure chart suggest higher prices in the weeks ahead. Let's check out this name and see how we want to position it.

In this daily bar chart of ARRY, below, we can see a rally from last September to February where prices climb quickly from below $4 to briefly over $13. If we were following this stock back then, we would be very happy with that kind of performance in just five months.

ARRY corrected from its February zenith to a May low and retracing about half of the previous gains. Prices have made higher lows and higher highs from that May low, so we can say that we are in a new uptrend.

Prices are above the rising 50-day moving average line as well as the rising 200-day moving average line. The daily On-Balance-Volume (OBV) line is doing what we like -- rising from November to February and then making a slight decline to early August. August looks like the OBV line is rising again and telling us that buyers of ARRY have become aggressive again. The Moving Average Convergence Divergence (MACD) oscillator is above the zero line again and is bullish.

ARRY daily bar chart from

In this weekly bar chart of ARRY, below, we can see that this relatively low-priced stock can really move. Prices are above the rising 40-week moving average line. The chart even shows a price gap in late 2016 -- something you usually do not see on a weekly time frame but it does tell us that demand was very strong. The weekly trading volume was extremely heavy. The weekly OBV line has a positive trend the past four years. The weekly MACD oscillator recently turned up to a fresh outright go long signal.

Weekly bar chart of ARRY from

In this Point and Figure chart of ARRY, below, we can see a longer-term pattern of higher lows and higher highs. The chart indicates a target price of $14.50 or new highs.

Long-term Point and Figure chart of ARRY from

Bottom line: I really like how these three charts are shaping up on ARRY. Aggressive traders can probe the long side of ARRY at current levels and add on a close above $12. A stop below $8.50 is what I would suggest. I would look for gains to the upper teens for this security.

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