The Hot List: 3 Medical Stocks on the Move
It may be true that long-only money managers are in a “buy first, ask questions later” mode in the wake of the Dow’s 300+ rally this week. But there are a few markets where the “buy now” news has not yet reached, which could be a boon for short term traders and active investors able to take positions in stocks like these before the rest of the market arrives.
Ahead of trading on Monday, there are a number of stocks in the health care and biotechnology/pharmaceuticals sectors that have begun to pullback toward levels from which they have historically outperformed in the short term. One example of this is MELA Sciences Inc. (MELA).
Shares of MELA are only recently off its highest levels of the year – reached mid-October – and the stock has been trending lower ever since. Not yet technically oversold, MELA nevertheless has closed lower for four out of the past six trading days.
More oversold from a technical standpoint are shares of Magellan Health Services Inc. (MGLN). MGLN was down just shy of 1% on Friday, moving closer to a new, 7-day closing low. The stock spent August and Septmber trading below its 200-day moving average and is most recently down two days in a row.
On cutting edge of health care are the biotechs, including Regeneron Pharmaceuticals (REGN). Pulling back for three out of the past four session in bull market territory, shares of REGN fallen to new short term closing lows again on Friday. REGN was down more than 1%.
Unlike MGLN and MELA, Friday’s selling has put the stock in technically oversold territory. The last time REGN traded to such extreme levels was in late September, when the stock gained more than 17% in three days after an extended, eight-day pullback.
All three stocks in today’s report were available from research and data available through PowerRatings. To learn more, click here.
David Penn is Editor in Chief of TradingMarkets.com