Medical Co. Trends Bullish

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).

chart

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.

Best Regards,

Chuck Hughes
Editor, Chart Of The Day

Chuck Hughes

Written By Chuck Hughes

Before Chuck Hughes won 10 Trading Championships, he was an accomplished Air Force pilot. In fact, he credits his success as a stock and options trader to his disciplined upbringing and career. When he was deciding between a career in the Navy and a career in the Air Force, the Navy told him he’d only have a 33% chance of flying jets. The Air Force gave him 100%. He liked those odds better. 35 years ago, Chuck had a wife, a young daughter, a son on the way, and a huge mortgage to afford. He didn’t want to give up on his lifelong dream and stop flying for a major commercial airline. He knew he needed to supplement his income during the 15 days a month he wasn’t flying. So he used his experience in discipline and math, and his understanding of finance and the stock markets (which he’d always been interested in,) and opened a $4,600 trading account. He made over $460,000 in profits his first two years of trading, and he hasn’t looked back since. When he was diagnosed with Meniere’s disease 15 years later, which commonly leads to vertigo…He knew his career as a pilot wouldn’t last much longer with those odds. But he didn’t have to scurry to find another gig, or panic about how his family would eat… He’d spent the last 15 years perfecting his system and raking in cash. As an options trader, Chuck does not let his emotions get in the way of his trading strategy. He adheres to disciplined and methodical options and stock trades. Because he respects the options game so highly, and understands the true freedom that financial solvency can bring, Chuck was able to design and refine his system and win those 10 Trading Championships. Put simply, Chuck Hughes’ trading strategies work, and in all types of market conditions. They’ve worked throughout the bull, bear, and flat markets America has seen in the last 30 years. Chuck Hughes has spent that time building a reputation as one of the most trustworthy options traders in the industry. His publishing group Legacy Publishing LLC was one of the few trading groups on the planet to have correctly predicted and profited from the 2008 financial crash .As a published author 16 times over, a 10-time Trading Championship winner, and an options-trading teacher for 25 years, he’s learned to trade and teach without an ego.