While the broad market maybe up sharply today, traders know all too well by now that stocks haven't been following through very well lately. If you're looking for a budding rally that has a shot at lasting, then you'll want to consider Carnival Corporation (NYSE:CCL), Agenus Inc. (NASDAQ:AGEN), and Complete Genomics, Inc. (NASDAQ:GNOM). Those three names have dropped clear - albeit subtle - hints that rallies are in the works.
For Agenus Inc., the clue is the way the stock's turned a downtrend into a new uptrend with a smooth, measured U-shaped reversal effort. AGEN started to make higher highs and higher lows in late August, but the big ceiling - the 50-day moving average line - was hurdled today. As you can see on the nearby chart, the 50-day average had been resistance a few times since June. The fact that the 200-day line (green) was the catalyst for the rebound makes the effort that much more impressive.
AGEN is a biotech name, perhaps best known for its currently-approved Oncophage vaccine for renal cell carcinoma. But, its Prophage - in development as a therapy for a few indications - is the drug that's spurring most of the new buying interest (and not just the last few days). Right or wrong, now that Agenus has turned the tide of market perception, the stock's apt to get more traction.
If the name Complete Genomics, Inc. rings a bell to our regular readers, that's because it should - I've pounded the table on it several times since mid-July, explaining how it was making good on a breakout effort the whole time. Better still, GNOM is still accelerating. Despite how much I'm liking the stock more and more, this is probably the last time I'm going to talk about it.
Whys that? Because GNOM has done about all it needs to do, and proven all it needs to prove, save one thing.... clearing the horizontal resistance at $3.31. And that hurdle is within reach as of today's move; I think it's going to be surpassed within a matter of days. Either way, after crossing above all its key moving averages, and then continuing on to higher lows, and turning around a catastrophic plunge over the prior 16 months, there's not much of an argument to say Complete Genomics isn't on the right track. The only question to answer now is where you're going to make your entry.
Last but not least, whether you want to believe it or not, cruise line company Carnival Corporation is doing better than it was four years ago, defying the notion that consumers aren't spending on vacations. 2010 was more profitable than 2009, and though 2011's bottom line was just a tad less than 2010's, the top line was actually bigger than the previous year's. Next year's top and bottom lines are also both expected to be better than this year's. Throw in the fact that CCL has topped earnings estimates in 11 of the last 14 quarters (the other three were 'meets'), it's difficult to think the stock isn't undervalued.
Anyway, what's most compelling about CCL right now is the strength of the stock's turnaround since Q2 of this year. While the daily chart broadly shows it, the weekly chart below does the rebound full justice. Carnival Corporation has left behind a long string of higher lows, and is close to a multi-month high as of today. Yet, with shares still well under the early 2011 peak around $47.50, there's plenty more room to run.