UPDATED June 27, 2017
BotTrigger Trade Alert: $KITE sold half of our allocation @ $100. Congrats to all who took this trade setup. Our KITE position is up more than a net 60% gain on this trade so far. Up +40% on buy alert 1 & about 20% since buy alert 2.
KITE has been an incredible mover for us, although certainly not without a few shenanigan pullbacks along the way. Notice we stayed cool as a cucumber during a few volatile moments. Why? Because the analysis was still rock solid in that KITE was in a confirmed uptrend & accumulation uptick was only increasing on the upswings, whilst volume was relatively muted on the down swings.
Today marks a near-term reversal on the daily chart. KITE got as high as $103.65 and looks to now be closing the session under $100. However, KITE's macro technicals look fantastic. We have a definitive break above a 3-year consolidation box. The top of that box was resistance around the $90 level. Effective last week, KITE broke through that on heavy volume and has traded squarely above that level for 7 full trading days. That's a strong indication that the market will start to bid this much higher. Take a look below on this weekly setup.
So again, we have 3 main time frames that we're always looking at:
1) Primary Term Time Frame - Trend over weeks, months, years worth of data
2) Intermediate Term Time Frame - Days to weeks worth of trend
3) Near Term Time Frame - Hours to Days of trend data
Right now, KITE is bullish in both the primary & intermediate term, with a neutral to bearish tilt on the near term. We suspect KITE can pull back about $5 to $10 points from here. We're going to look to add back into this in the low $90s. We're doing this largely to flex some trades as their is no official sell signal that's been triggered on KITE. KITE looks fantastic, but we suspect we can play catch about 5 to 7% lower. If we get a firm break above the $105 level before that happens...we'll be forced to wait for that add-entry on the next relative pullback.
May 4, 2017 Original Post
BotTrigger Trade Alert: $KITE bought/added @ $83.70 another 3% allocation bringing our total allocation here now @ 6%. KITE's looking to resume its advances after 7 weeks of rest in building out this ascending triangle. Ascending triangles are bullish continuation patterns. We see KITE here slowly peaking it's head out of the triangle on moderately increased volume that's been advancing every day for the last week. Meanwhile daily stochastics has curled bullish on the 2day chart.
--March 3rd Update--
View our original post with images & first alert on KITE here → https://goo.gl/VE4PFj
With biotech especially, secondary stock offerings are par for the course. KITE's recent secondary announcement earlier this week (March 1) caused the stock to top out in the near term with a -5% gap down the following Thursday. From the high to the continued selling as of today we're now nearing an -11% pullback. Keep in mind that the stock just broke out nearly 40% since Monday.
For some perspective, here's a table recapping the biotech plays we've traded during the last year (TSRO, AKAO, LNTH, KITE) and their respective performance after a secondary stock offering announcement. Notice their initial reaction was bearish in the near-term. After the move was digested, the rally eventually resumed.
For visual reference, here are the charts on those plays. The announcement is distinguished by the start of the red highlight and that box is how long it took until the stock reclaimed it's previous high and eventually broke out higher.
Once the news & pout was digested, their underlying narrative resumed to propel the stock higher in the following months. The one that took the longest to perform was LNTH but due notice where this current BotTrigger holding is now. We've held through all that non-sense. There was a bevy of pullbacks and shenanigans during that time. But we were grounded in the pattern cultivation that proceeded the larger picture.
Right now with KITE, on the larger macro picture, we have a very decisive breakout from a year long base that's accrued. There is a lot of energy in that base and when you have a departure from it, it's a very strong indication that the trend/sentiment has changed. As we can see here, KITE has basically created a giant double-bottom, W pattern over the course of a year where it's tested the lows on 2 occasions and rejected those lows. KITE tested the highs on 2 occasions and finally broke out from it's year long gridlock. So that's the bigger picture that is worth acknowledging. For new members or for anyone wanting to take a look at a refresher on Double Bottom & Inverse Head & Shoulder breakouts that occur on macro time frames, please review HERE
So these macro patterns tend to matter. They are strong bottoming reversal patterns that statistically follow through with their suggested outcomes with a high degree of probability. We've said multiple times so as to remind ourselves & our Members, things don't go straight up overnight..it takes time. Parabolic breakout rallies where a stock keeps printing new highs every day for months on end is not the behavioral norm. They are outliers. Like KITE's similar predecessors, TSRO, LNTH, AKAO all took time to digest the announcement, pullback some and then rallied higher...so the idea here is to give this time to move. Let it digest the announcement and give it room to retrace.
With that being said, we're not stuck to the notion that KITE will breakout higher. This is the market and anything can happen. We're simply suggesting that KITE still has the earmarkings of a stock that is getting ready for more upside. Although we're willing to go through a draw-down, we will be vigilant at letting this go if downside momentum shows strength beyond what has been observed before in the context of other successful case studies. Right now, this pullback is in line with historical precedent.
We'll update this post as we go on our next move. We are interested in adding to KITE but will need to see more before adding any further exposure at this point.
--March 1st Update--
BotTrigger Trade Update: $KITE is up today over 11% with volume so far in mid-week at a record 16.8 million shares traded. For perspective, the 3 largest volume weeks that previously occurred were: 12.8m, 12.4m, & 10.4m. So we're not even done with the week & $KITE is already at 16.8 million shared traded this mid-week alone. What's more, we also have a very decisive RSI breakout on the weekly chart as can be seen here ^. Considering the strong accumulation uptick we're seeing, we may be increasing our allocation on this name before the end of the day. For an entry, currently the 5min & 10min stochastics are in bearish crossovers & the 1hr & 2hr stochastics is curently squeezing at the top range...what this tends to mean is that a little pressure is getting relieved around this area.
--Feb 28 Original Post--
BotTrigger Trade Alert: $KITE bought 3% allocation @ $71.24 as we have a very strong momentum breakout due to positive clinical trials for their cancer treatment for non-Hodgkin lymphoma which had an 82% success rate where trial patients conditions notably improved & 30% of total trials (36 out of 101) had a "complete response" where cancer disappeared entirely. We don't usually talk narratives here but the backdrop here is important as it's very similar with the narrative that we saw develop with TSRO. Technically this breakout on KITE has a text-book target of around $86/share. This action today shows that KITE wants to revisit it's all time high of $89.84 which is conveniently aligned with the text-book breakout target. Considering how overextended this move is, it's not uncommon to see a retracement here. Considering the small starter position we're taking today, we're ok with nibbling a few long here to start.