Healthcare has been an excellent performer as of late and investors would be best to stick to buy candidates within the strongest groups. CLVS was part of one of our recent blog posts and one of our strategies is to enter stocks that reclaim their 50 day SMAs which set up future patterns which can be very powerful. CLVS has now traded almost 20 handles above the suggested 84 trigger and further down in this post we look at LLY which is setting up nicely. Below is how CLVS was looked at in our Monday 8/31 Game Plan.
Stocks that can be bought as they take out their 50 day SMAs and then through valid base structures are CLVS. CLVS is a healthcare play up 44% YTD and 84% over the last one year period. This week put a halt to a 3 week losing streak gaining 10.8% in firm volume recording a bullish engulfing week in the process. Earnings have been inconsistent with 3 losses of 3.2, 1.8 and .4% on 8/7, 5/7 and 11/7 (it rose 1.7% on 2/26). CLVS is currently trading right near a 83.56 cup with handle breakout trigger taken out on 4/13 jumping 13% in a base that began 11 months earlier. It is best viewed on the weekly chart and we know the longer the pattern the better chances of success are. Look to enter with a buy stop above its 50 day SMA at 82.75 and add to through a double bottom trigger of 92.65.