Looking for a nice uptrend? Try Akorn (AKRX). (July 25, 2016)
AKRX
I want to look at Akorn ( NASDAQ:AKRX ) here; it’s in the healthcare sector, it’s also got a real healthy uptrend. We’ve got a series of higher lows. This was THE low, high volume move to the upside, this is called a power move. When you see this kind of blastoff from the BOTTOM of the chart a lot of times you’re just not going to see the stock come back down here. Because again, high volume, big move to the upside, and that reflects a lot of institutional buying. They will be soaking up every share they can on any kind of pullback, and this is what you see. The reason I draw this box is, it’s not the same way when you see this kind of big spike, high volume on the TOP of the chart, because a lot of time that reflects a blow-off top. Where finally it’s the last gasp of impatient buyers, they finally get the stock. HUGE volume, and then it reverses and you never see it again. Here, from the bottom, after this kind of downtrend. Finally a big, steep pullback and then, Bam! There’s something going on here. This is the bottom, now you’re buying on pullbacks. And look at the trading channel right here.
So as I look at Akorn ( NASDAQ:AKRX ) I know I’m drawing a lot of lines here, but they are all relevant. As I look at this, it has broken out to a higher high. They report earnings next week. Here’s my take on it: I have no idea what the earnings results are going to be. If I did that would be inside information; but this uptrend is in tact. I would say you want to be long this stock, which is coming out of a bit of a volatility squeeze. You want to be long this stock, at least going into earnings. Also this MACD indicator, Moving Average Convergence Divergence indicator, it’s a trend and a momentum indicator. This midline here is the difference between uptrend versus downtrend. So the fact that this is above shows that this is in an uptrend, according to this indicator. The fact that the indicator is moving higher itself gives it stronger and increasing momentum. So this is an indicator, I call this a Swiss Army Knife of technical indicators, it shows a really nice uptrend so you want to be long.
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