Last Updated on March 7, 2019 by Sultan Beardsley
This swing-trade for Conatus Pharmaceuticals, (Nasdaq:
Another indicator I see that is quite appealing is from Stochastic Oscillator. As you will see in the chart, Stochastic Oscillator has been on the money with
Resistance Levels & Potential Exits
Near-term I am looking for CNAT to close above: 1.96 -> 2.07 -> 2.16 -> 2.20 -> 2.55.
A move past $2.55 could bring CNAT into the high $2 or low $3 range.
Furthermore, I feel long term investors have a good opportunity to open or add to positions. Technical Analysis traders tend to gravitate toward “nice charts”; bringing additional volume to the table. Statistically, after 3 passes at a resistance level resistance strength dwindles dramatically which could send CNAT soaring to the referenced range.
MS Money Moves feels CNAT is undervalued and that the sell-off after disappointing top-line ENCORE-PH results was an overreaction. But, with that comes opportunity.
There are two binary events that we are bullish on in 2019; and a third where our position is neutral.
- Top-line results from ENCORE-NF (NASH Fibrosis)
- Expected in the 1st half of 2019
- We predict
CNATwill hit their primary endpoint: Improve fibrosis by at least one stage from baseline without worsening of NASH compared to the placebo as determined by liver biopsy.
- ENCORE-PH (Portal Hypertension) extension results
- Expected in mid-2019
- We predict improved clinical outcomes will be observed compared to the placebo. MELD, Child-Pugh scores, and biomarker data (presumably ALT, AST, cCK18, and caspase-3/7) should indicate improved liver function.
- Top-line results from ENCORE-LF (Liver Function)
- Expected in mid-2019
- In this clinical trial,
emricasanis up against the worst NASH has to offer: Decompensated Cirrhosis.
- Luckily, the primary endpoint is improving event-free survival compared to a placebo rather than a change in Hepatic Venous Pressure Gradient (HVPG).
- With over 2-years of dosing, we believe the probability of meeting the primary endpoint is greater than 50%.
If we are correct, then top-line results from ENCORE-NF should be a massive upward catalyst. In lieu of any unexpected developments CNAT’s valuation should appreciate into the data readout. The other binary events discussed could sustain the positive price action.
I am/we are long CNAT.