Yesterday, we looked at a Daily Price Chart of ACM Research, Inc., noting that the stock has been making a series of higher highs and higher lows.
Today’s Chart of the Day is a 10-Month Simple Moving Average (SMA) chart for Abiomed, Inc. (NASDAQ: ABMD).
Abiomed, Inc. engages in the research, development, and sale of medical devices to assist or replace the pumping function of the failing heart. It also provides a continuum of care to heart failure patients.
The company offers Impella 2.5 catheter, a percutaneous micro heart pump with integrated motor and sensors for use in interventional cardiology, and Impella CP, a device used by interventional cardiologists to support patients in the cath lab and cardiac surgeons in the heart surgery suite.
Now, below is a 10-Month SMA chart for Abiomed, Inc.
Back in April, the ABMD 1-Month Price crossed above the 10-Month SMA, indicating ABMD is on a PowerTrend ‘buy’ signal (circled).
Guess what happened next…
Sure enough, prices continued to rise.
Since the PowerTrend ‘buy’ signal occurred for the stock back in April – when the stock was around $191.25 – the stock has seen a 56.4% increase.
Now, as you can see, the 1-Month Price is still above the 10-Month SMA. That means the bullish trend is still in play!
This bullish price trend makes ABMD a good candidate for a call option purchase.
As long as the 1-Month Price remains above the 10-Month SMA, the stock is more likely to keep trading at new highs in the coming days and weeks.
We’ll be keeping our eye on this stock as it continues to trend upward. That way we’ll know the moment the market conditions shift and the stock begins to come back down, offering a better buying opportunity in a bullish market.
Additionally, we’d like to talk about how a previous Chart of the Day stock has done…
The Power of Options
On July 27, we highlighted ServiceNow Inc. (NYSE: NOW), noting that NOW’s OBV line is sloping up. Thereby validating the stock’s bullish trend.
If you happened to have purchased NOW shares on that day, you’d already be up 4.8%.
But… if you had purchased the right option contract, you would be up 46.9% in just two days’ time!
That’s the power of options.
Editor, Chart Of The Day