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Thu. 22 Jul 2021, 4:58pm ETBenzinga
In: Long Ideas, Short Ideas, Health Care, Technicals, Top Stories, Trading Ideas, General

ImmunoPrecise Antibodies Ltd. (NASDAQ:IPA) skyrocketed 136% on Thursday after the company announced its TATX-03 PolyTope Therapy demonstrated potent pseudovirus neutralizing activity against the COVID-19 Delta variant in vitro.

IPA’s four monoclonal antibody cocktail previously showed efficacy against the Alpha and Beta variants, in vivo, in a hamster challenge model.

“Our TATX-03 cocktail is rationally designed for broad epitope coverage relying on multiple antibodies, which have shown in pre-clinical studies to work synergistically together, to reduce the risk of mutagenic escape, and have the potential to reduce the risk of new variants. We believe this strategy of multi-antibody cocktails is more crucial now with the surge of new variants of concern and breakthrough cases,” said Dr. Ilse Roodink, IPA’s Chief Scientific Officer and Global Program Director for COVID Research.

With the Delta variant spreading dramatically, which lead to a steep market sell-off earlier this week, IPA’s potential new therapy excited investors and the stock gapped up over 24% Thursday morning.

The ImmunoPrecise Antibodies Chart: On Wednesday, IPA busted up through a descending trendline that had been holding it down since April 15. The bullish break would have been enough to push the stock higher but IPA’s news caused massive bullish volume to enter which drove the price up substantially.

The move put IPA into overbought territory with a relative strength index of over 83%, which caused consolidation on lower timeframes. IPA also became extended from its moving averages and once the volatility decreased slightly on Thursday afternoon the stock was trading about 75% and 90% up from the eight-day and 21-day exponential moving averages (EMAs), respectively.

Thursday’s move caused the eight-day EMA to cross about the 21-day EMA, which is bullish, and IPA was able to regain support of the 200-day simple moving average (SMA), which indicates overall sentiment in the stock has become bullish. Bullish traders will want to see IPA close Thursday’s session about the 200-day SMA.

Bulls also want to see continued momentum push IPA up over a resistance level at $10.10. If it can regain the level as support, it has room to move up toward $12. Above that, there is resistance at $14.95

Bears want to see IPA lose under the 200-day SMA and for bearish volume to drop the stock below the $8.55 mark. If it were to lose the level as support, it could fall back down toward $6.64.

IPA Price Action: ImmunoPrecise Antibodies closed up 136.5% at $13.22 per share.