Tesaro (TSRO) seems to be another name making the rounds of unofficial merger talk. This story comes with an asterisk * -- I have no knowledge of any deals, but I think I can read a chart. Let's take a look.
In this daily chart of TSRO, above, we can see an eye-popping upside gap at the end of June. You had to buy the gap day, because this stock has not looked back -- and a decent pullback did not happen until the end of August. As TSRO has pushed up to new highs for this move up, it is above the rising, 50-day average line, and the 200-day line.
The On-Balance-Volume (OBV) line shot straight up with the gap, as volume surged. The Moving Average Convergence Divergence (MACD) oscillator is bullishly positioned -- rising, and above the zero line. TSRO is still pointed higher and only a close back below $94 would make us question this advance.
In this four-year weekly chart of TSRO, above, the huge gap disappears, but the chart is still bullish. Prices are above the rising, 40-week moving average line. The OBV line on this weekly timeframe has been moving up for several months. Upside momentum has been strong, but has slowed recently.
How high might TSRO go? A point-and-figure chart, above, is one way a chartist can get price targets. The price objective for TSRO from this 1x3 point-and-figure chart is $120.