OCGN is a pharmaceutical company that is currently in the prosess of developing a COVID vaccine that is hoping to receive FDA approval. Recently, they have landed partnerships to hopefully send their vaccine "Covaxin" to the United States.
Backing by the market has been shown in their vaccine as stock price jumped from $3 to highs of $18 (roughly a 500% increase) in early Febraury 2021 on the 180 day chart. There is strong volume behind the stock at an average of around 115,000,000. Furthermore, the stock did have a reversal. However, after the hype pumped the stock price for OCGN, the reversal gave the stock an opportunity to show strong supports at the $5.90 mark. After consolidation from the early hype in February 2021, a strong resistance was also shown at around the $13.50 - $14 mark. This consistent pattern of support and resistance on the 180 day chart makes it extremely profitable for swing traders. However, for long term traders there seems to be extremely high upside as well. This strong resistance has been tested on 2/11/21, 3/3/21 and just recently on 4/23/21. This stock is poised for a breakout as I noticed in my own technical analysis, when a resistance is tested 3+ times, the next time could be the likely breakout for the stock, which shows why it is at such an intriguing price today on April 27, 2021. The fibonacci retracement on the 20 day chart showed that the stock has strength because the pullback reached the 50% section at around $9.74, which shows belief that the stock will hold this new support at around $9.74, and continue to uptrend from there. On April 23rd, the stock price officially crossed over the 180 day simple moving average which indicated that the stock was now officially in a bullish state. Furthermore, ever since bouncing off of its support at around $5.70, it has held strong above the exponential moving average, which indicates the strength of the bull run that this stock has, and it's ability to continuously hold above the exponential moving average. The MACD indicator also indicates that it is a good time to buy the stock based off of its history. The stock is currently on the oversold side of the RSI at around 62, however for the shorter time traders, time should be given to the stock for it to cool down and once again find another reliable support and resistance to indicate strong buying points.
In conclusion for technical analysis, there are strong support and resistance points shown eversince early February that shows promise for swing traders and enough volume in the market to keep the price moving. The $13.50 - $14 resistance is tested and will be tested again in the near future, which shows signs of a breakout for OCGN. On the 20 day chart, the stock showed a 153% increase, but the intriguing aspect was that the fibonacci retracement retraced back to a healthy 50%, which again shows strength in the stock to uphold its high prices.The stock now shows a strong bullish pattern after crossing over the 180 day simple moving average and consistently holds above the exponential moving average. The stock is close to the oversold side at the moment, however it still shows strong promise for future growth. The MACD indicator also shows that it may be a strong time to finally buy the stock based off of its history. If the wall is broken at $13.50, expect the stock to grow exponentially.
Not only does OCGN show promise through technical analysis, catalysts are also oncoming which can override my technical analysis and make the stock rise greatly or fall terribly, I believe that the upcoming catalysts will be positive and cause the stock to increase. This is because OCGN already has experience in creating drugs like their OCU400 to cure blindness, OCU200 to treat diabetic problems and OCU410 to develop solutions for gene therapy. OCGN is currently looking for their FDA approval so that they can administer their vaccine in the United States. The United States is looking for suitors because the recent Johnson and Johnson vaccine was discontinued due to people having several health side effects (ex: blood clots) and the Astrozeneca vaccine also failed in the U.S, leaving available room for the possible OCGN covaxin. Just recently, the jump in stock price on April 21 was due to OCGN completing stage 2 of their vaccine clinical trials without any problems in their test subjects. As mentioned in the introduction OCGN has also partnered with Bharat Biotech so that they can further administer their vaccine in the United States, and are currently looking for more investors. The increase in the demand for vaccines will draw in more investors to further develop the Covaxin, especially with the current spike in cases in India, global demand is at an all time high. I do expect a lot of news coming in the near future, and predict most of this news to be very positive.
Although Ocugen seems like a risky investment, the possible returns on investment make buying the stock very worth it. Comparing against Pfizer and Moderna stock prices, there is a strong chance that if the Covaxin ends up getting FDA approval, this stock should be upwards of $40, which makes the $11 stock price today seem like a large discount. Technical analysis and future catalysts have shown that OCGN is the right investment to take part in, and at the end of the day, you get to take part in a company that will save many lives and help bring this pandemic to an end.
Picture 1: Strong levels of support and resistance on the 180 day chart. Resistance tested 3 times over the course of 3 months.
Picture 2: This is a 20 day chart to get a deeper look into the recent price spike. Fibonacci retracement of the recent price increase in late April. Created a healthy retracement at 50%.
Picture 3: This is a 20 day chart to get a better look into possible parabolic increases. Bull flag pattern forming, showing another possible breakout pattern in the coming weeks.
Picture 4: RSI on the 180 day chart showing that it is a little bit on the overbought side, however it has just reached under being oversold and could be great discount prices for individuals depending on their strategy.
Picture 5: MACD indicator on the 180 day chart showing that it may begin to show a good time to buy the stock at a discounted price., depending on the investor's strategy.