EarningsBeats Digest July 29th 2020

Published: Wed, 07/29/20

EarningsBeats.com Digest for July 29, 2020

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This Biotech Has Been Consolidating Ahead Of Its Earnings Next Week

Biotechs ($DJUSBT) can be quite unpredictable, but the group as a whole has been very strong in 2020 and the group has been strengthening again the past few days. After breaking out in mid-June, Incyte Corp (INCY) has been consolidating in a fairly tight range between 98 and 110.

Check out this chart:

The good news is that it's not overbought. Its RSI is just 46 and its PPO has fallen all the way back near centerline support. It would be easy to see a nice rally begin from this level. Overall, volume trends, while not spectacular, have certainly been more than solid. The mid-June breakout occurred on accelerating volume and July advances have generally been accompanied by heavier-than-normal volume. Lighter volume has generally been seen when INCY falls back. I'd be careful on a move much below 97.50, but outside of that, I'd expect to see INCY make another run back toward its recent high closer to 110. We could see that with a pre-earnings push - INCY reports its latest results next week (Tuesday) and has beaten its earnings estimate in 4 of its last 5 quarters.

Happy trading!

Tom Bowley

Chief Market Strategist

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