Could one stock really tell you where the broad market heads? Joe Friday shared he thought so on November the 13th in the chart below. Bio-tech stock Valeant Pharma (VRX) had been slammed the prior few months and the broad market dipped along with it.
The chart below reflected the VRX was testing five support lines at one time at (3), along with oversold momentum at (1) and volume was sky high at (2), which could have reflected panic selling. All of these conditions would suggest this price point was key for the stock and maybe the broad markets.
Since the Joe Friday post, VRX is up over 28% in less than 3-weeks
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We remain of the opinion that what Bio-Tech does going forward is key for the broad markets and VRX is an important part of the puzzle. We shared of late that Bio-tech was up 250% more than the S&P 500, from the 2011 lows and highs of this year. (See post here)
Below looks at an update on VRX.
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The 28% rally in the past couple of weeks has VRX up against falling channel resistance at (1) above.
The Power of the Pattern continues to believe, what happens at (1) above, will have profound impact on VRX going forward and could well impact the broad markets as well. Stay tuned friends, this could be a BIG DEAL for both bulls and bears!!!
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