Highly Bullish Technical Trading Alert Issued for Generex, Golden Cross Imminent

Written by Michael Vlaicu Alerts Feb 1, 2010

A highly bullish technical trade alert has been issued on Generex Biotechnology Corporation (NASDAQ:GNBT) on the even of the N.I.C.E. conference news. The company was recently introduced on our website as one of the most undervalued biotechnology companies of the early 2010 year, keeping investors glued to the screen as they await any new developments. Within the next few days, the company should release a handful of key updates, which could potentially propel the stock’s price to retest the 0.7 resistance

Taking a look at the chart, it is easy to see why technical analysis fans might call this a ‘lucky break’ type of investment, and there’s a number of reasons to validate that terminology. Firstly, the all important Relative Strength Index (RSI) has positioned itself in an upward trend, making a move past the climactic 49.79 level, representing that the stock has a neither overbought or oversold sentiment in the market. Next in line we have the MACD divergence which is beginning to turn and trend upward, followed by the Full Stochastics which is bouncing off the key 18.50 bottom further verifying the bullish indicators. Most importantly, we notice the volume bars marked by the green, and the red bars which represent the sell orders. As we can see, the fewer green bars outweigh the many smaller red bars, indicating a long-term bullish pattern, and further confirming that the recent decline was a simple consolidation, perhaps an indication of longs taking profits.

Currently the stock has reached a strong support level at the $0.60 price per share level, which should not be broken, unless some bad news is expected, however, highly unlikely. During the last few days, we noticed the white empty candle sticks which represent the same run-up pattern which cased the stock’s price to rise from $0.50 to $0.70 and beyond. Despite all of this, the most important aspect has yet to be discussed, the Golden Cross. This is the most bullish technical indicator, should it be validated by volume. This occurs when the 50 day Moving Average crosses the 200 day Moving Average while trending upwards. When this occurs in bullish trending stocks 8 times out of 10 times you see the stock gain added momentum as this is a major bullish signal used by technical investors. Long term indicators carry a lot more weight and a Golden Cross indicates a bull market is on the horizon, thus you can expect a lot of stock scanners to showcase Generex as the next big buy signal.