Today, I want to revisit Chinook Therapeutics, Inc. (KDNY) and cover the latest move in the stock.
Regular readers will know Chinook, as it was included on our Watchlist for the last two weeks…
But it also became an official recommendation in my premium Alpha Stocks trading service this week.
In fact, I actually recommended four biotech stocks in total, including KDNY, Alkermes plc (ALKS), which I talked about on Wednesday, and two others.
But today, let’s look at the recent action in KDNY, which allowed Alpha Stocks members to take some quick profits off the table yesterday…
As a reminder, KDNY is a strong biotechnology stock coming out of a large base.
If you look at a weekly chart, you will notice the huge base pattern and the horizontal resistance level that have persisted for about two and a half years.
However, the stock has pushed up against that level numerous times over the past few weeks, and it looks like a breakout is imminent.
As regular readers know, these bases are where large, institutional investors accumulate massive amounts of stock.
And that is showing up in the volume bars for KDNY, which you can see marked by the red arrows in the chart above.
There was significant short-term resistance at the $17 level for almost a year in KDNY, but it broke out in mid-June before pulling back to that level.
This also happened to be where the 21-day exponential moving average (EMA) was sitting.
So, after tapping support and holding above the 21-day EMA, I suggested Alpha Stocks members take a position in KDNY.
We recorded an entry price of $17.99 on July 5, and the stock climbed to $18.31 by the end of the day.
The next day, the stock rose another 1.9% to close at $18.65.
But by yesterday afternoon (July 7), the stock was all the way up at $19.67 for a gain of 9.4% from our entry point!
Stop and Look Around
Now, I fully expect a big move out of this base. But it’s important to remember the market environment we’re in…
It’s very choppy, and traders remain on edge about any and all challenges facing the economy.
So, if we have a solid gain, I’m much more likely to take some profits and reduce exposure quickly.
And that’s exactly what we did in Alpha Stocks…
I sent an alert to subscribers yesterday instructing them to close one third of the KDNY position, and we collected partial profits of 8.4% in just two days!
The stock tapped longer-term resistance at the highs yesterday before pulling back into the close, and it looks like it will open lower this morning.
However, with the profits we’ve already taken, we have some cushion to let the remaining two thirds of KDNY run.
One Last Chance to Join Alpha Stocks
On occasion, the best of the best Watchlist stocks featured in this newsletter become official recommendations in my premium Alpha Stocks trading service…
And I’ll do my best to keep you posted on these ideas as they develop…
But if you want to get full guidance on these ideas, including intraday alerts when it’s time to take profits or cut losses, you need to sign up to become a member before enrollment closes!
Alpha Stocks recently recorded a 21.6% gain on the downside in only eight days as Pegasystems Inc. (PEGA) stock plunged…
As well as a gain of 21.3% in just 15 days in Permian Basin Royalty Trust (PBT).
Last Wednesday, we closed another winner in ProPhase Labs, Inc. (PRPH) for a two-day gain of 5.8%.
And as you just read, we just closed out another two-day winner on a third of KDNY for a gain of 8.4%.
Of course, we also hold a live members-only session every Monday so that subscribers can ask questions and get guidance about our trades.
Enrollment is about to close, so click here now to register for a special Alpha Stocks presentation this afternoon before it’s too late…
Embrace the surge,
Editor, Stock Surge Daily