I’m flattered by Buffett after he
saw my blog and decided
to also put money into my idea to support me! What a Valentines and Chinese
New Year gift from Buffett :).
I’m talking about Teva, the world largest
generic pharmaceutical company that has been beaten down to nearly death but I
saw a great turnaround potential from it. See here if you don’t believe. Following
its initial fast up run, I said: “Teva is
bumping up against its resistance and is very overbought short term with clear
negative divergence in many technical indicators. A pause or even retreat from
this level is quite possible near term.” The fast advancing TEVA did pause
for a while after my writing, coming down almost by 20% towards $18. With
Buffett’s big news broken out, it jumped over 10% immediately and now is trading
around $21. The million dollar question is if TEVE will start to move up from
here towards my next target of $30? It is certainly possible but I doubt about
it. While I have no doubt that TEVA will be on its way for a historical turnaround
in the long run that is now vindicated by Buffett, I’m afraid Teva may still
struggle for a while before definitely mounting its next leg up. It is more technical
than anything else. The recent jump due to Buffett’s effect is not supported by
its daily momentum as it still looks very vulnerable to me. I think there is a
good chance that TEVA may come down again at least one more time before
accumulating enough strength for a more sustainable uptrend. It will be
interesting to see how Teva will behavior moving forward with Buffett’s support
in hand.
No comments:
Post a Comment