Agios Pharmaceuticals Inc (NASDAQ: AGIO)

Agios Pharmaceuticals, Inc., a biopharmaceutical company, focuses on the development and commercialization of therapeutics in the field of cancer metabolism and rare genetic disorders of metabolism in the United States. The company’s product candidates include AG-221, a potent inhibitor of the mutated isocitrate dehydrogenase (IDH) 2 protein for the treatment of patients with cancers that harbor IDH2 mutations; and AG-120, an oral inhibitor of the mutated IDH1 protein for the treatment of patients with cancers that harbor IDH1 mutations. Its product candidates also comprise AG-348, an oral small molecule and activator of the pyruvate kinase-R enzyme used for the treatment of patients with PK deficiency.

Take a look at the 1-year chart of Agios (NASDAQ: AGIO) below with the added notations:

1-year chart of Agios (NASDAQ: AGIO)

AGIO has been working its way lower over the past 8 months. During that time, the $90 price level (blue) has become very important to the stock over. Not only was the $90 level a resistance area back in October and November, that level was also support once AGIO got above it. Last week the $90 level was hit as resistance, yet again.

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The Tale of the Tape: AGIO has a key level at $90. A trader could enter a long position on a break above $90 with a stop placed under the level. However, if traders are bearish on the stock, a short trade could be made instead at the $90 resistance.

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!

Good luck!

Christian Tharp, CMT

Follow me on Twitter: @cmtstockcoach