Sarepta Therapeutics, Inc., a biopharmaceutical company, focuses on the discovery and development of RNA-based therapeutics for the treatment of rare and infectious diseases. Its lead product candidate is Eteplirsen, an antisense PMO-based therapeutic in clinical development for the treatment of individuals with Duchenne muscular dystrophy. The company is also involved in developing treatments that are in clinical development include AVI-7288 for the treatment of Marburg virus and AVI-7100 for the treatment of influenza. In addition, it focuses on developing preclinical research product candidates for the treatment of other neuromuscular, infectious, and rare diseases.
Take a look at the 1-year chart of Sarepta (Nasdaq: SRPT) below with my added notations:
For the most part, SRPT has been trending lower for the last 8 months. However, during the most recent 3 months the stock has had a tendency of creating key price levels at the increments of $2.50 (red). For example, the current level of support is $12.50. Next, $15 has popped up a couple of times as both support and resistance, same thing with $17.50.
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The Tale of the Tape: SRPT is approaching its key level of $15. A long trade could be made on a break above that level with a stop placed under it. A short trade could be made at $15 with the expectation of a fall down to the next $2.50 level at $12.50.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT
Follow me on Twitter: @cmtstockcoach