Quick very bullish biotech related trading idea. LGND – Ligand Pharmaceuticals is displaying a bullish weekly ABC pattern that is breaking to the upside right now. As you can see on the chart the weekly MA 30 (moving average) Stan Weinstein uses is acting as support. LGND has put in a clearly visible consolidation pattern. This is the first consolidation after the stock has entered Stage 2. Technically speaking this is one of the best risk reward trades you can get.
- Thrusting move
- Established uptrend i.e. Stage 2 according to Weinstein
- Tight consolidation
- Hitting weekly MA 30 support
- Resumption of the trend leading into the consolidation pattern
This is one of the best charts I can come up with right now. This looks like a decent position trade going forward as there is lots of pattern pressure and the stock can be traded based purely on its technicals. I have a position.
Click on the chart to maximize:
Conclusion: This looks like the best thing technical analysis has to offer. Liquid stock. Roughly 1 billion market cap. Smooth trading behaviour. Decent position trade.
Company description from LGND’s website:
Ligand is operating with a business model that is based upon the concept of developing or acquiring royalty revenue generating assets and coupling them to an efficiently lean corporate cost structure. Ligand’s goal is to produce a bottom line that supports a sustainably profitable business. By diversifying the portfolio of assets across numerous technology types, therapeutic areas, drug targets, and industry partners, we offer investors a de-risked opportunity to invest in the increasingly complicated and unpredictable pharmaceutical industry. We believe Ligand has assembled one of the largest and most diversified portfolios of current and future royalty-generating assets in the industry. These therapies address the unmet medical needs of patients for a broad spectrum of diseases including thrombocytopenia, multiple myeloma, diabetes, hepatitis, muscle wasting, dyslipidemia, anemia and osteoporosis. Ligand’s Captisol® platform technology is a patent protected, chemically modified cyclodextrin with a structure designed to optimize the solubility and stability of drugs. Ligand has established multiple alliances with the world’s leading pharmaceutical companies including GlaxoSmithKline, Merck, Pfizer, Eli Lilly & Company, Baxter International, Bristol-Myers Squibb, Onyx Pharmaceuticals, Lundbeck Inc., and Spectrum, among others.
- Located in La Jolla, California
- Over 85 fully-funded partnered programs
- Main revenue drivers are Promacta, Kyprolis, Captisol and license fees
- Profitable and cash-flow positive
- 21 employees
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