Good Day Traders,
My stock analysis for today is on Amgen Inc (AMGN) as price action could be heading to the strong round number of $100. Amgen Inc is an american based multinational bio-pharmaceutical company located in California and is the worlds largest independent biotechnology firm.
You can see price was in a consolidation phase since mid 2008 on the weekly chart, which would have prompted the Smart Money trend traders to “stand aside” and allow the dumb money to scrap for a few pips here and there, staring at the screen the whole day, pulling their hair out which no doubt would have sent the stress levels through the roof. This sideways movement continued for the best part of four years before price had eventually decided to start trending once again much to the delight of any Smart Money trend trader.
Keeping with the weekly chart the bullish continuation of the trend was confirmed by the break of the $65 resistance zone which occurred at the beginning of 2012. Now depending on your trading style, entries could have been taken prior to the breakout of 2012 and any aggressive Smart Money trader would have found them selves in good early profit. A mini breather was inevitable after the bullish move however this only lasted for a few short months as price retested the now $65 support zone and continued its bullish move towards the $70 mark before an even steeper move up and beyond $80. Price has continued to move up but it seems the bears are determined to halt the movement as price has creped towards the $85 mark where it has found some sort of resistance.
This comes as no surprise if you squash the data back on the weekly chart you will see price is just above the weekly resistance zone and highest peak of 2005. Observing the daily chart and price action a little closer you would see the steady incline and breathers of Jan 2012 to present. This is the kind of movement us Smart Money trend traders are looking for, which for the Trading room members provided many opportunities to enter the markets using the break out strategies or for those who wanted to be a little more cautious, were able to employ the Bouncer strategy which allowed them to become risk free early on and extract numerous profits from this stock with little to no effort. Once entered in to the market with our Smart Money strategies which takes no more than a few minutes, all that is required is the management process which allows us to extract the profits from the market with little fuss and bother and very little time.
Current price action has broken above the weekly resistance line and highest peak of 2005 and therefore finds it’s self in uncharted territory, which has most likely caused the dumb money to panic which in turn has caused price to retrace and pull back. This is common knowledge to the Trading Room members and is a good sign as the next most obvious psychological level would be the $100 mark which would be prices most likely destination. What we would like to see is for price to retest the now support zone, bounce, continue to be bullish and break above the pivot high heading towards the strong round number of $100. Then Trading room members would wait for the signal bars to occur and as long as target is met before the strong resistance zone then further profit taking opportunities can be had.
However you decide to enter this trade always do your own analysis!
Please register for our next webinar on Monday December 17th 2012 here. It will be our last webinar for 2012. Places are limited so book now.
For further discussions on our Smart Money principles and trading and to meet members of our excellent Trading Room, please visit http://www.facebook.com/thedynamictrader.