Mylan N.V., together with its subsidiaries, develops, licenses, manufactures, markets, and distributes generic, branded generic, and specialty pharmaceuticals worldwide. The company provides generic or branded generic pharmaceutical products in tablet, capsule, injectable, transdermal patch, gel, cream, or ointment forms, as well as active pharmaceutical ingredients (APIs).
Take a look at the 1-year chart of Mylan (NASDAQ: MYL) below with my added notations:
MYL had been in a rough downtrend going into November. Since the November low, however, the stock had repeatedly stalled at the $40 level of resistance (green). Now that MYL has broken above and held that level, $40 should provide support for higher prices.
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The Tale of the Tape: MYL broke through its key level of resistance at $40. A long trade could be entered on a pull back down to that level. However, a break back below $40 could negate the forecast for a higher move and would be an opportunity to get short the stock.
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