Assembling a BioTech Trade in Assembly Biosciences

• Posted by Greg Harmon
• on January 22nd, 2015

Biotech has been a hot area for over a year. And every time it looks like the top may be in and pullback underway prices reverse higher again. Most of this market sector is driven by new drug trials and approvals. I know nothing about that. But what I do know is that when investors and traders learn about the results big moves can happen. And most often someone knows early and the move starts ahead of the data. It may not happen every time or even the next time. But that is some color from my view.

One name that has been on my radar for a couple of months in this space is Assembly Biosciences ($ASMB). They may do great things or not (they deal with poop), but that is besides the point. The chart of the stock price is what interests me. This stock had a massive drop in February 2014 and has since settled since then at the 23.6% retracement of the down move. It is not ready yet, but on a move over the October highs, over 9.47 the 38.2% retracement level at 11.58 or the 50% level at 13.85 or higher would be the target. There is no resistance until then. There is not much short interest in this stock, but with low daily volume it still could squeeze higher on the trigger.

you can set an alert for this or just place a Good til Canceled Contingent Buy Order. This order would trigger on a move over 9.50 to buy the stock whether you are watching it or not. the daily chart (not shown) has the stock moving higher over the 20 day SMA with a rising RSI and MACD. So now may not be a bad time to get ready.

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