Last Updated on July 8, 2019 by Kevin Douglass
Recent data release may have changed SGMO’s future outlook. Sangamo’s long-term chart suggests a potential pullback to $4 is a possibility, but that was before a recent data release by the company for updated Phase 1/2 Results for SB-525. This is an investigational Hemophilia-A gene therapy that showed sustained increased Factor VIII Levels with no reported bleeding events and no factor usage for as long as 24 weeks of follow-up. Some traders do not believe in technical analysis , that’s fine, but I think you may want to re-consider and hear me out on this one. Most didn’t believe in Sangamo either (aren’t I right Sangamo fan’s)!
What Does The Chart Say?
The long-term pattern (from day of IPO ) suggests that if Sangamo Therapeutics (Nasdaq: SGMO) stock price continued its trend, it was a possibility that pattern would repeat therefore potentially pulling back to December 2016 lows of around $3.67. Although this may still be a possibility, SGMO caught wind in its sails on good data release recently, re-igniting investor optimism. I remain cautiously optimistic with SGMO, so I went ahead and put together a short-term game plan just in case. Take a look at the list of what I’ll be watching for, while I wait for further confirmation of long-term trend indications.
When making previous highs, SGMO’s stock price had entailed devastating 5-wave corrections, however:
- The daily chart suggests that instead of a 5-wave correction that could potentially take SGMO to sub $4, SGMO’s chart details an AB=BC corrective wave that could potentially mark the low of the long-term selloff.
- AB=BC corrective waves are equal in length/or magnitude and on a Bullish correction would bounce off the 0.786 retracement level.
- SGMO had a sharp bounce off this level in Feb 2019 and closed the day right above the 0.786 retracement zone. This is a very important level of support to close upon.
- If this did not happen I would be on the other side of the trade waiting for a wash, down to $4. But from my experience there still may be fighting chance.
- Short-term (from Feb 2019 to now) SGMO continues to make higher lows, this is #Bullish.
- Although SGMO looks to have failed to break current resistance in the chart above, volume/ optimism packed enough punch to test $11.85 which is a 1.618 Fibonacci extension (normal extensions range from 1.272 or 1.414). . . #Bullish
- May not be exactly what a Long-term investor’s of SGMO would want to hear, but a pullback around .618-. 786 retracement (shown in green-zone on chart) would be a nice place to add for swing-trade up to earnings .
- Previous earnings have brought 10-20% run-ups, but be careful to not get trapped in an earnings selloff.
- If SGMO continues to make higher-lows, this could be a potential range to be looking for a swing position.
- Breakout of this zone could mean big $$
- Fall below blue trend line could mean devastation.
- my stop-loss will be set below blue trend-line.
Again, it’s a long way down to $4 if trend continues to follow its Long-term pattern. Previous trends have issued 5-wave correction peak to trough (high to lows), however I believe the current pattern details an AB=BC harmonic pattern (outlined in RED) please press play and zoom out to see what I am referring to.
Tip # 5: In mathematical terms, a trend line means the line of best fit. When using them, make sure they touch as many points as possible on the chart.
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Disclosure: I do not own SGMO . I may buy/sell within the next 72 hours. This is not a note to buy or sell. Please do your homework before investing.
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