Alnylam Pharmaceuticals, Inc., a biopharmaceutical company, discovers, develops, and commercializes novel therapeutics based on RNA interference (RNAi). Its pipeline of investigational RNAi therapeutics focuses on genetic medicines, cardio-metabolic diseases, and hepatic infectious diseases.
Take a look at the 1-year chart of Alnylam (NASDAQ: ALNY) below with added notations:
ALNY had been in a sideways consolidation from October through February, and during that time also creating a very important resistance level at $140 (green), which was also ALNY’s 52-week high resistance barrier. Now that the stock has broken above that level, traders could look to enter a position on a decline back down to that $140 mark.
The Tale of the Tape: ALNY broke its 52-week resistance at $140. The possible long position on the stock would be on a pullback down to that level with a stop placed under it. A break back below $140 could negate the forecast for a move higher.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT