Two generic drug makers with good medicine for the bulls. Mylan (MYL) and Supernus Pharmaceutica..
Discussed in this article: Mylan Inc. ( $MYL )
I want to look at a couple stocks today, generic drug companies. The first one is Mylan ( NASDAQ:MYL ). This was the strongest drug company in the Nasdaq 100 today. As you know health care, drugs, biotech, those things have all been on fire and this has been one of the strongest ones here. You look at the weekly chart, nice drift higher, has not gone parabolic, but since the last couple weeks this stock has gone up a bit. There was an announcement that one of the company’s partners, I forget the name of the partner, doesn’t really matter here; they had a drug that was approved in India and that’s driving this stock higher.
I don’t think that it’s too late to buy this stock; I think you’re okay, but you need to have a longer time horizon. You can’t look at this chart though and say, “You know what? I’m going to back away from this stock because this is the absolute high here. If I buy right now I’m going to be buying the absolute high.” I don’t think you are, but you are buying this stock extended. So if you want to get involved here fine, take a little bit of stock, but just know that ultimately the stock pulls back, ultimately it pulls back away from the upper Bollinger Band.
So be ready to take some stock if you do happen to get a gift and the stock pulls back to 42.00 maybe even closer to the of 50-day moving average, it gapped up here, it went for a ways before the stock pulled back. So we could see the same type a thing where Mylan ( NASDAQ:MYL ) moves up a bit into the high forties and then pulls back. So it really just depends on what your outlook is for this stock. The only thing that I prohibit is plunging, and that has nothing to do with your toilet, what I’m talking about is just jumping in all at the same time on a stock that’s extended.
Now, this is a random stock, it’s also a generic drug company, I don’t believe that I’ve ever covered this stock before and may not again. I was looking at the group of generic drug companies and I noticed this one, Supernus Pharmaceuticals ( NASDAQ:SUPN ), its got a fairly high short interest, they posted a narrower-than-expected loss back on Wednesday morning, maybe it was Tuesday afternoon. But this was the first day that the stock was trading after earnings were released, it ran up pretty big, a gap down here, and a trade up in a big way.
So where’s the stock right now? Well, there was the earnings high, there was the earnings low, we stretch this around and we’re up near this high here. So when I look at the fairly high short interest and I see this kind of move today, and I see the other drug companies moving, this is a stock that you may want to keep in mind. I’m not going to follow it, again it’s just kind of a pattern really, it’s just a pattern stock for me. So you zoom out here and you can see the stocks been in consolidation for a while. I would say if the stock starts trading above the upper Bollinger Band, which is 7.33, that’s 12 cents. If it starts trading up here you want to watch for this because we could start getting more of a short squeeze and push the stock up much further.
So I hope this works for you, shoot I hope this works, and if it works then I hope it works for you. So I want you to check out this stock as well as Mylan ( NASDAQ:MYL ) and I think you’re going to make some money.