Amgen (AMGN) is known for its work in human therapeutics. Historically, some of Amgen's most successful drugs have been used to treat low white blood cell counts, osteoporosis, and colorectal cancer. Personally, I am getting to the age when I may have to start thinking about researching some of them.
The biotechnology firm reported their quarterly numbers after the close of trading Monday. The company beat EPS estimates but missed on revenue. A $6 billion share buyback is planned for Q1 and AMGN gapped higher Tuesday.
Let's look at the charts. In
our review of December 30 we wrote that " This current rally in AMGN could surprise on the upside. Add to longs at current levels and consider buying more on a close above the 200-day line. Raise stops to $215."
In this updated daily bar chart of AMGN, below, we can see that prices stayed above our $215 stop point and gapped higher today. AMGN has made a new high for the move up and trading volume has been increasing since the beginning of the year. AMGN is trading above the rising 50-day average line and gapped above the 200-day line.
The daily On-Balance-Volume (OBV) line dipped in January but is starting to rise again. The Moving Average Convergence Divergence (MACD) oscillator has narrowed and is poised to cross to the upside for a new buy signal.
In this weekly Japanese candlestick chart of AMGN, below, we do not have the current price movement plotted as this charting service waits until Friday to update their free charts. We can imagine that prices are trading above the 40-week average line.
The weekly OBV line is moving in the right direction and the MACD oscillator is close to crossing above the zero line.
In this daily Point and Figure chart of AMGN, below, we can see a $299 price target. Let's call it $300.
Bottom line strategy: AMGN may encounter some selling resistance in the $245-$260 area which could slow or stunt the current advance. Traders should raise stops to $225 from $215. Carryover buying in the days ahead will be encouraging.
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