I'm constantly looking for short-term trading opportunities and Perrigo (PRGO) fits the bill. After reporting better-than-expected results in its latest quarter, PRGO gapped up strongly and today filled its gap before finishing on a solid note to print a hammer (blue circle below) - many times a signal of a bottom after a downtrend. Reported revenues of $1.23 billion easily exceeded expectations of $1.17 billion. In addition, EPS of $1.39 blasted past the $1.10 consensus estimate. Now the issue is whether PRGO can overcome a very weak pharma group ($DJUSPR) to bounce from gap support:
The early September breakout occurred on heavy volume and that now represents the best price support near 79. Gap support is closer to 81 so that support range of 79-81 needs to hold. The recent high after earnings is a solid target at 91. The reward to risk opportunity here grows as PRGO moves closer to its support range.
Happy trading!
Tom
