On the morning of October 16, 2023, Mike Paulenoff posted the following analysis of TEVA (Teva Pharmaceuticals) to our Coverage List and our Discussion Room:
This is how I see TEVA's technical setup near term: As long as TEVA is trading below 9.00, it will remain vulnerable to a still deeper correction of its May-Sep upleg from 7.09 to 10.72. In the absence of a climb from current levels at 8.73 above 9.00 on a sustained basis, my optimal key nearest-term corrective target zone is 8.40 down to 8.10 from where I will be expecting a potent upside reversal. Finally, let's be aware that TEVA is headquartered in Tel Aviv, Israel which just might complicate anyone's decision to take a long (or short) position at this time. Last is 8.72...
Fast-forward exactly one week, on 10/23/23 TEVA hit a significant corrective and reversal low at 8.06, a few cents beneath the lower boundary of Mike's anticipated bottom window, from where TEVA climbed a whopping 41% into last Friday's (1/05/24) high at 11.35.
Even more impressive perhaps, is that the October 2023 to January 2024 advance positions TEVA above the major resistance line from its 2/12/20 high and poised for a potentially explosive upside breakout from a 2-1/2 year base-accumulation period and pattern (see my attached Daily Chart) that conservatively projects higher targets of 13.00 and 14.25 in the upcoming weeks (continued below my Daily Chart of TEVA)...
From my very big-picture technical perspective, I can make a compelling case that TEVA is emerging from a sideways accumulation pattern that originated at its August 2019 low of 6.07, and as such, triggers longer-term projections into the 20-25 target zone.
Apart from the promising technical setup, TEVA's improving fundamentals should support considerably higher prices. The following December 8, 2023 snippet from independent Seeking Alpha analyst Stephen Ayers describes TEVA's business prospects:
This shift [from HOLD to BUY for 2024] is driven by Teva's successful resolution of opioid litigation, strategic rebranding efforts, and the promising potential of their anti-TL1a drug, TEV'574, for inflammatory bowel disease [IBD]. The settlement marks a significant turnaround, allowing Teva to refocus on growth and innovation. Coupled with a stronger balance sheet and the growth trajectory of key products like Austedo, Ajovy, and Uzedy, Teva is positioning itself as an attractive option for investors seeking a turnaround story in the pharmaceutical sector.
Whenever a bullish technical setup is supported by improving fundamentals and a positive shift in earnings potential, traders and investors take notice. TEVA is one such relatively large mid-cap biotech name that deserves to be on our radar screen heading into 2024.
Join Mike and our MPTrader members heading into 2024 for their intraday discussions about TEVA as well as many other individual stocks, Magnificent 7 setups, sector ETFs, macro indices, commodities, and Bitcoin...