Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading
Shares of Sareum Holdings Plc (LON: SAR) rallied 10.7% higher, extending the current uptrend despite the biotech company not making any significant announcements.
Today’s rally was driven by Sareum’s upbeat preliminary half-year results released by the company on Friday last week. It seems investors are pretty bullish on the company despite reporting a £550,000 for the period.
The company reported encouraging initial results after testing its SDC-1801 drug candidate on COVID-19 patients and is looking forward to releasing preliminary results later this year.
We covered the company’s half-year results in detail here.
Sareum shares are headed towards the next resistance level shown in the chart below, building on the momentum generated by Friday’s report, and some bullish traders might be eager to jump in at current prices.
However, I would hold off on opening any new bullish positions since the company’s shares have been rising for a few days now and seem ready for a pullback. The best time to open bullish positions was at the start of last week when the shares were trading much lower.
The current price setup indicates that a pullback is likely to happen sometime soon before the rally continues, and I would look to buy after such a move is complete. We could also get a pullback at the 2.50p price level, which is why I’m holding off for now.*
I’m still bullish on Sareum, given its impressive drug pipeline, but the swing trading opportunities provide some profits as investors wait for the long-term thesis to play out.
Sareum share price.
Sareum shares edged 10.69% higher to trade at 2.38p after rising from Friday’s closing price of 2.15p.
Sareum shares are traded on the London stock exchange's AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Sareum shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies
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