At the end of December, the stock of Gilead Sciences Inc. (NASDAQ: GILD) had moved higher, after being on a decline since end of April 2020. But after finding resistance slightly above the 68-dollar mark, the share price corrected lower and it is now oscillating around the 200-day EMA. The stock is definitely one to watch, especially today, as it delivers its earnings report after the US closing bell. The company ran into some obstacles lately. And not because of its Covid-19 vaccine, but because of another drug, filgotinib, which is made to treat rheumatoid arthritis. However, the FDA did not approve that drug, as it showed some side effects. But that doesn’t mean that it’s the end of that drug, it just means that the company has to improve it, which may lead to an approval later on. In terms of today’s earnings release, the current EPS forecast is for a higher number, than the previous number for the same Q4 period of 2019.
From the technical side, if the stock remains somewhere above the 64.17 hurdle, marked by the high of January 11th and the lows of January 29th and February 2nd, that may interest new buyers to jump in. GILD might then rise back to the 66.17 hurdle, or the 68.34 barrier, marked by the highest point of January. Initially, the price could stall there for a bit, however, if the buying interest is still on the higher side, a break of the 68.34 zone will confirm a forthcoming higher high, possibly opening the door towards the 69.74 area, or the 72.27 level. Those levels mark the highs of August 18th and 4th respectively.
Although the RSI and the MACD are currently seen pointing a bit lower, the RSI still remains above 50 and the MACD is still running above zero, despite sitting slightly below its trigger line. The two oscillators are still showing positive price momentum, which supports the above-mentioned scenario.
On the downside, if the share price drifts all the way below the 61.45 hurdle, marked near the lows of January 11th, 13th and 14th, that could increase the stock’s chances of sliding further, as new buyers might stay away from entering for a while. GILD could fall to the 59.63 zone, marked by the low of January 5th, which may provide a temporary hold-up. That said, if new buyers are still nowhere to be found, the stock might end up sliding to the 57.92 area, which is the lowest point of January.
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