Alexion Pharmaceuticals Does Not Look Boston Strong

Charts of the Boston-based biotech to do not provide a compelling case to buy the stock.
Stocks quotes in this article: ALXN

The Lightning Round is a very popular segment of Jim Cramer's Mad Money program. Callers get the chance to ask Jim about stocks they are interested in. Thursday night one caller asked about Boston-based Alexion Pharmaceuticals Inc. (ALXN) : "This valuation is too high. It's not my favorite," replied Cramer. 

Let's check out the charts of ALXN to see what they can add to the conversation.

In the daily bar chart of ALXN, below, we can see that the prices were in a declining phase from April to September/October. Prices have shown some improvement into November but the pattern of lower highs is still intact. Prices are trading between the slightly rising 50-day moving average line and the slightly declining 200-day moving average line.

The daily On-Balance-Volume (OBV) line has been weak from July and tells us that sellers of ALXN have been more aggressive -- this is not what chart watchers want to see. The 12-day price momentum study shows a small bearish divergence from October to November as momentum weakened slightly. 

 
In the weekly bar chart of ALXN, below, we see a mixed picture with the price action and the indicators. Prices are below the declining 40-week moving average line.
 
The weekly OBV line shows are on the rise the past four months, signaling more aggressive buying while the Moving Average Convergence Divergence (MACD) oscillator has crossed to the upside for a cover shorts buy signal. 
 
 
In this Point and Figure chart of ALXN, below, we can see a potential upside price target of $125 and that a trade at $104.44 could weaken this chart. 
 
 
 
Bottom-line strategy: These three charts of ALXN do not yet provide a compelling case to go long.
 
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TAGS: Investing | Stocks | Technical Analysis | Pharmaceuticals | Mad Money

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