‘New Jersey is Cancer, and it is Hot!’

Three of the biggest drug companies in the world Bristol Myers Squibb (ticker: $BMY), Celgene Corp. (ticker: $CELG) and Merck & Co. (ticker: $MRK) have their headquarters in New Jersey. Well technically BMY is headquartered in New York City, close enough to be a suburb of New Jersey and frankly most of their plants and employees are in New Jersey, to allow their executives to move around more easily. That is because with about 300 million people living in the Garden State (last time I counted), most of those over 50 and living within 30 miles of New York City, and with some sort of disease or handicap, it is easier for a healthy executive to walk from one place to another than to be driven in a limo in New Jersey. They are the smart ones.

But why do these companies locate in New Jersey? Isn’t it obvious, old people are the ones that get medicare/medicaid and can pay for expensive drugs! But huge drug companies need more and more old people to keep growing. Hmm, that reminds me, Governor Chris Christie also needs a bigger tax base to grow the State out of its deficit. Here’s an idea to help both out and I will give it away for free. A new state slogan, “New Jersey is Cancer, and it is Hot!” How better to attract sick old people to the state then to point out just how much money they can spend right down the street on drugs. I think the drug companies are already talking internally about this as their charts look ready to take off. Let’s look.

Bristol Myers Squibb printed a long shadowed candle Tuesday and then confirmed it higher Wednesday finishing on the high very close to the resistance at 29. If it can get through 29 then the target on a Measured Move (MM) would first be 29.50 followed by 30.20 and finally 31.50. The Relative Strength Index (RSI) is bullish but the Moving Average Convergence Divergence (MACD) indicator is growing negative. Clearly this stock is being held back a bit due to its New York City connections. Drop the beard and move the Headquarters to New Jersey to help it out already.

Celgene has recently broken above its long term support/resistance line at 60 and is now testing the high from 2 weeks ago at 61. If it can get through that then the target on a MM is 65 with resistance at the November high of 63 on the way. The RSI points higher and the MACD crossing positive is bullish.

Merck has been in an uptrend and is now testing the resistance of the previous high at 37.55 from March 2010. If it can get through then it has resistance next at 39.43 and 41.88. The RSI is supportive of a move higher but the MACD suggests there may be some consolidation first.

So there is still some work for Governor Christie and the drug companies to make the situation better for everyone. So one more parting gift. The song to go with the slogan, and it should be sung by Paris Hilton.

New Jersey is Cancer, and it is Hot!
New Jersey is the Cancer, the Cancer, the Cancer
New Jersey is the Cancer, and boy is it Hot!
Cause Your Pills are My Pills,
and My Pills are Your Pills
New Jersey is the Cancer, and boy is it Hot!……

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