We looked at Merck’s (MRK) charts on October 1 as the stock rose higher following the announcement of its antiviral drug Molnupiravir. We recommended that “MRK is likely to widen a gap at the open on Friday. Prices could continue to soar, but if there is a slight drop or pullback after the first hour of trading on Friday, traders aggressive people could intervene and make purchases. Risk at $ 74. “
Let’s see how things are progressing with the news the company has filed with the FDA for the emergency use of its new drug.
In this daily bar chart from MRK, below, we can see that prices have “recovered and filled” since October 1 with most of the price gap intact. Seeing buyers using the available weakness to buy instead of selling and hope to buy back at lower levels is a bullish development. The 50 and 200 day moving averages are on the rise.
Trade volume rose sharply and the On-Balance-Volume (OBV) line appeared on this aggressive buy. The Moving Average Convergence Divergence Oscillator (MACD) is bullish and pointing up.
In this Japanese MRK weekly candlestick chart, below, we can see that the price gap on the daily chart is disappearing but not the uptrend. Prices are well above the 40 week moving average line. The increase in trade volume is bullish.
The OBV line has been closed since February. MACD Oscillator goes higher for a new buy signal.
In this daily points and numbers chart from MRK, below, we can see a bullish price target of $ 108.
In this weekly points and numbers chart from MRK, below, we’ve used only closing price data and a five-box reversal filter. Here, the software offers a goal of $ 117.
Result strategy: The measures taken by Merck shouldn’t come as a big surprise, but they are giving investors the right signals. Continue to hold the recommended long positions on October 1. Increase the stops to $ 76 instead of $ 74. The $ 108 area is our first goal followed by $ 117.
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