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Christian Tharp, CMT

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Five Star Stock Watch: Gilead Sciences

One part of the market has held on, another part seems to be falling apart.

Over the last month or so the S&P 500 and Dow Jones Industrials have essentially moved sideways, but the Nasdaq and Russell 2000 have clearly trended lower.

Tech stocks, and specifically biotech stocks, have really taken a beating. However, there has been a slight recovery over the last couple of days.

So let's take a look at a specific biotech stock, Gilead Sciences, Inc.

The company: Gilead Sciences, Inc.

Ticker Symbol: (NASDAQ: GILD)

Sector: Healthcare

Industry: Biotechnology

Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and commercializes medicines for the treatment of life threatening diseases in North America, South America, Europe, and the Asia-Pacific.

Related: Five Star Stock Watch: Nike

The company’'s products include Stribild, Complera/Eviplera, Atripla, Truvada, Viread, Emtriva, Tybost, and Vitekta for the treatment of human immunodeficiency virus (HIV) infection in adults; and Sovaldi, Viread, and Hepsera products for the treatment of liver disease

Please take a look at the one-year chart of Gilead below with added notations:

benzinga_gild_0.png

Gilead had been trending higher most of last year and into this year. However, the month of March was definitely a rough one for the stock.

A key price level to watch on the stock would be $75, which has been both support and resistance off and on since November. A break back above that level could mean the sell-off for Gilead, and possible the whole industry, has come to an end,

One more thing to watch would be Gilead's 200-day moving average. Although these articles do not highlight this indicator very often, it is certainly one worth watching if a stock is clearly reacting to it. Gilead has found support on its 200-day MA twice over the last couple of weeks.

Related: Five Star Stock Watch: JPMorgan

Gilead is set to release earnings on April 22, 2014.

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.

Tags: Five Star Stock Watch

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