Don't look now, but YM BioSciences Inc.(AMEX:YMI), Cytokinetics, Inc. (NASDAQ:CYTK), and Origin Agritech Ltd. (NASDAQ:SEED) are starting to drop bullish technical hints. Are these omens of bigger moves brewing up? Could be. Take a look.
Two months ago, Cytokinetics, Inc. was practically radioactive. The stock was already in a slide that started way back in April, but the late-June plunge from $0.85 to a low of $0.57 pretty much had the market convinced CYTK was a sinking ship. Funny how quickly things can change. Since then, shares have moved upward again, with today's 3.5% bump carrying shares above the 50-day moving average line for the first time since April. Give it came after a key higher low, and that the stock gave up so much ground in the second quarter, this small move could spark a much bigger bullish one.
CYTK is a biopharma company, with a focus on developing small molecule therapies that treat muscle-related ailments. It's lead drug candidate in CK-2017357, currently in Phase 2 trials to treat muscle aging, muscle weakness, and wasting or neuromuscular dysfunction. However, since the heart is also a muscle, Cytokinetics could almost be considered a cardiovascular play in that it's developing drugs that also improve heart function.
Speaking of turnarounds, Origin Agritech Ltd. is working on one of its own. Only in this case, the effort may be even more sustainable than the one we're seeing from Cytokinetics. Specifically, SEED has formed a smooth, bowl-shaped reversal that extends all the way back to April (the downside of the bowl shape. It's only been within the past two weeks that the chart has started to make net-bullish progress. But, now that it has, it's looking strong. Specifically, the stock's not only above the 20-day and 50-day moving averages, but it's now finding support at them, and using them as a pushoff point.
SEED is seed (corn, rice, cotton, and canola) company doing business in China. The stock was hammered last year, falling from a peak of $11.86 early in the year to a year-end close of $2.36, as the company managed to keep cutting its full-year outlook. But, between the fact that it's got new seeds in development - and some newly approved seeds since late year - it's tough to imagine that Origin Agritech Ltd. could do any worse this year or next than it did in 2011. Though not profitable (and not expected to be anytime soon), the P/S ratio of 0.37 is a screaming bargain in itself.
Last but not least, and admittedly the most speculative of these technical trading ideas, YM BioSciences Inc. looks like it's trying to rock its way out of a consolidation phase (orange), and the tail end of a converging wedge (blue). Though YMI hasn't busted out of either confine yet, it is finding support at key moving averages, most of which have already bullishly crossed one another. While not complete, reading between the lines we can sense that a breakout storm is brewing.
YMI is, as the name would suggest, a biotech stock. It's developing a handful of cancer therapies, though its flagship drug is CYT387, for treating myelofibrosis. It's in Phase 2 trials right now. While YM BioSciences may be at least a couple of years away from getting any of its R&D projects approved, banks, brokerage, and research firms have made no bones about their love and hope for the stock. That bullish banter alone could be enough to light a fire under the stock again, and erase last year's tumble from a price of more than $3.00. The spring sure looks coiled anyway.