Biogen shares (Bahrain Islamic Bank) It explodes higher on Wednesday, up nearly 40% on the day.
The stock is rising due to promising data from the company’s last phase of Alzheimer’s drug trial.
According to Martin Packardax on TheStreet, Biogen and its Japanese partner, Eisai Co. Ltd. reported better-than-expected results from a study in their late-stage treatment for Alzheimer’s disease.
This stock has put in some massive moves over the years in both directions, so seeing a rally today is not surprising. But the rally comes at an interesting time as the S&P 500 hit 52-week lows on Tuesday.
And while today’s movement is impressive, it’s not the nearly 50% gain we saw in the initial market. It has investors wondering if this is a possibility going forward.
Let’s take a look at the charts, as Biogen is near a key level bulls will want to see as support.
Biogen stock trading
With this morning’s rally, Biogen broke the $220-$225 resistance area, as shown on the weekly chart above.
The stock soared to $283.44 in today’s session, off its pre-market highs and the 38.2% retracement low near $295.
One RealMoney contributor was “bearish at anything near $300” and that was the right choice.
It was difficult to clear the $295-$300 region, but if you did, it would open the door for Biogen to test in the $325-$330 region.
As it fades a bit from the top, the stock holds its gains well throughout the session.
Bulls will love to see Biogen stock hold in the $265-$265 region. This is where we find the VWAP metric correlating with a higher explosive move in June 2021, as well as the 200-week moving average.
A break below this area opens the door down to $250 or possibly lower. But above $260 to $265, bulls are in control – at least for the short term.
If it holds up and the stock rises, watch for today’s high near $283 as an upside target, then $295 to $300.