Weekly Stock Pick

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Now if you still like stock trading review this this weeks stock pick of mine. First I hope you had a good Christmas after the worst year economically that all of us have ever experienced in our lifetimes. I wish I could share some good news for the equity sector with you, but my chart work is not showing anything good just yet. I’m mostly short, and have been for the last three weeks with decent returns. I am seeing some upside in selected stocks but not that many compared to the short sells. I would be leaning toward the small caps for any upside surprises possibly. I was thinking the Santa Claus rally might materialize but it didn’t that much if at all.

Scanning the stock charts for some low-risk high-reward trade setups this early Monday morning, I’ve zeroed in on a short-sell candidate in the biotechnology sector. I’ve been thinking for quite some time now that healthcare stocks are going to start losing their rich profit margins they’ve been enjoying for quite some time now and with the change of leadership in the White House, and now with this current economic environment, 2009 could be the time the medical stocks start selling off even more than what they have already. In fact I would forecast and predict this year that the healthcare stocks might be the next financial disaster to hit the stock market and economy.

Short-Sell Gilead Sciences. Ticker GILD

Sell Entry: 49.73 to 51.04

Stop-Loss: 51.20

Take Profit Areas

46.81 to 45.35

41.68 to 41.18

35.53 to 33.40

Some of My Reasons for Selling Gilead Short

Number one its showing a major ABC sell setup with a nice tight stop-loss making this stock a very low-risk very high-reward short-sell trade if the market proves me right. Two, way too much optimism. I’m reading current articles from other analysts giving Gilead buy recommendations for a variety of reasons. I see no other short recommendations on GILD right now. Jim Cramer on his “Mad Money” TV Show on December 22nd said “I'm recommending Gilead Sciences and will continue to pull the trigger on that one." Cramer has been wrong so many times this year, it might be continued “Easy Mad Money” to take the other side of the trade on his stock picks right now. Three, the market is still heading south in my opinion. Four, the medical sector rich profit margins are going to get squeezed in this economic environment.

Gilead Sciences Company Profile

Gilead Sciences, Inc. (Gilead) is a biopharmaceutical company that discovers, develops and commercializes therapeutics in areas of unmet medical need. The Company has United States and international commercial sales operations, with marketing subsidiaries in Australia, Austria, Canada, France, Germany, Greece, Ireland, Italy, New Zealand, Portugal, Spain, Switzerland, Turkey, the United Kingdom and the United States. Its commercial teams promote Truvada, Viread, Emtriva, Hepsera, AmBisome, Letairis and Flolan through direct field contact with physicians, hospitals, clinics and other healthcare providers. Its corporate partner, Astellas Pharma, Inc. (Astellas), promotes, sells and distributes AmBisome in the United States. In September 2007, it acquired Nycomed Limited, a wholly owned Irish subsidiary of Germany-based pharmaceutical company, Nycomed GmbH.

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Click the Gilead Sciences Stock Chart for a larger view.