GILD long

2020년 5월 9일

Assumption: GILD is entering into new ascending trend. In trends it is good to buy on local corrections. Now is the time to go long on this stock (I mean long - for like 2 years hold, not two days or weeks, not options). I assume it will reach 125$ within the first leg of the move (max 2.5 years, but could come sooner).

Rationale:
End of January GILD entered into a stable but extremely choppy trend (weekly ADX confirms price increase) with a high volatility (about 5% daily avg), with a triangle-like consolidation from march till mid of april finished with a nice breakout (the gap of 17.april) where also a resistance has been confirmed (~86$). Triangle breakout potential has not been reached yet (~90$).

Now after gap has been filled and resistance confirmed once more (30.04) - GILD is back to testing support at 74.4-76.3$.
The decline since 30.04 is accompanied by a declining daily ADX, so to be treaded as corrective by nature.

Perhaps now is a good moment to go long, assuming this is just a return move to the broken resistance (triangle) to confirm support.

From trend perspective - daily ADX has been falling and now is very low (9), which means a significant move is imminent (both downside or upside in near term).

Longer term, a significant upwards move is emerging, as monthly ADX started rising from low levels of 15, together with increasing price, thus confirming direction.

Note. I'm an amateur, it is just my personal opinion and should not be treated by any means as investment advice by anyone.