When Gilead (GILD) speaks, investors listen

Trader 2 Trader

This Monday our long-term holding Gilead Sciences Inc.(GILD) announced acquisition of Kite Pharma Inc.(KITE) for $11.9B. It was a first bigger acquisition since $11B deal back in 2011 when GILD bought HepC drug inventor Pharmasset.

Kite Pharma (KITE) is a clinical-stage biopharmaceutical company, which focuses on the development of novel cancer immunotherapy products. This strong push into immunotherapy may be a transformative deal for GILD as well as for some other companies which are working on cell-based therapies.

Yesterday GILD had its one of its strongest days in years, jumping up over 7% in a day, clearing some key resistance levels on very strong volume. Here are next targets on this big-cap biotech.

There were other sympathy plays which have had a great week following GILD's acquisition news. JUNO, BLUE, NVS, BLFS and VCEL are companies which are working on cell-based therapies.

We picked VCEL as it formed Cup & Handle pattern over the past 8 months and broke out above $3.70 on strong volume. We already took 24% profit at Target 2 as it left unfilled opening gap yesterday. Following our sale, the stock started a pullback and closed the gap by market close. After re-buy near session lows we look for a continuation of the uptrend.

Happy trading!

We use cookies to offer you a better browsing experience, analyze site traffic, personalize content, and serve targeted advertisements. Read about how we use cookies by clicking "More information". If you continue to use this site, you consent to our use of cookies.