BioMarin Pharmaceutical Inc. (BMRN) has broken out on the upside from a major base pattern. Prices could climb 30% or more from here. Got your attention?
In late May, we said "I could have said to go long BMRN earlier but now I feel more confident in my recommendation. Traders could go long BMRN here and above $94.55 looking for $108-$110 on the first leg to the upside. Risk below $84." Prices have not yet reached our first price target but let's check out the charts and indicators now that we are north of $100.
In the updated daily bar chart of BMRN, below, we can see a pattern of higher highs and higher lows from April. Prices are above the rising 50-day moving average line and the bullish 200-day moving average line. In the middle of June we can see that the 50-day line crosses above the 200-day line for a bullish golden cross. Often we see golden crosses well off the bottom but this time we see this bullish signal in the middle of the range.
The daily On-Balance-Volume (OBV) line has been positive since early March and has set new highs in July to confirm the price gains and tell us that buyers have been more aggressive. The trend-following Moving Average Convergence Divergence (MACD) oscillator has been in a bullish mode since early May.
In this weekly bar chart of BMRN, below, we have a bullish alignment of the indicators. Prices are above the rising 40-week moving average line. Prices have made a weekly close above the highs of 2016 - 2018 so this is a major upside breakout. The weekly OBV line is positive and rising and the MACD oscillator is above the zero and rising -- all bullish.
In this Point and Figure chart of BMRN, below, we can see the breakout at $100.37 and a longer-term upside price target of $131.51.
Bottom line: I have not seen a bullish breakout from a large base pattern in a while. I am very impressed. Longs should continue to hold positions and can add on strength. Raise sell stop protection to $92 from below $84. Our targets are $110 followed by the $125-$131 area.