Having spent considerable time recently highlighting stocks at the top of the SIA Relative Strength Matrix, today weāre focusing on some neutral (yellow zone) stocks that have shown increasing strength in recent months. These stocks are emerging as early leaders within the otherwise lackluster SIA Drug Sector. One such stock is Gilead Sciences (GILD), which is currently ranked #34 and has moved up 10 spots in the past month within the neutral zone of the SIA S&P 100 Index Report. As shown in the SIA Drug Sector Report clipping above, weāve highlighted Gilead and AbbVie in positions #4 and #5, respectively. From a performance perspective, Gilead is up 6.21% over the past month, 18.12% over the past quarter, and 14.47% year-to-date (YTD), compared to the iShares S&P 100 Index returns of -0.20%, 7.76%, and 24.50% over the same periods. This outperformance began in the past quarter, which has driven GILDās rise on the relative strength matrix. This rally is also visible on the Point and Figure chart, where GILD's position is color-coded GILDās within the SIA S&P 100 Index Report, which remains in the neutral zone (yellow). Notably, GILD has broken out of a double-top formation at $85.91 (highlighted in the chart). Resistance levels are initially at $100.65, with further resistance at $120.29. Support is currently at $82.57, with long-term support dating back to 2017 at $73.32. These support and resistance levels provide a broad view of potential price movement as we head into 2025. The SIA SMAX calculation now reads 9 out of a possible 10, indicating that Gilead is not only emerging as a leader among its peers but also outperforming many other asset classes.
AbbVie Inc. is another neutral-zone stock in the SIA S&P 100 Index, currently ranked #30, but in the #5 position within the SIA Drug Sector Report. AbbVie has also demonstrated strong performance, with 1-month returns of 4.00%, 3-month returns of 6.75%, and an impressive 34.09% YTD. AbbVie has outperformed the index on 1-month and YTD returns, while its 3-month performance is roughly in line with the broader index. In the attached Point and Figure chart, AbbVieās position within the SIA S&P 100 Index has fluctuated between the favored (green) and neutral (yellow) zones throughout the summer of 2024. Recently, AbbVie broke out (as shown in the chart) with red resistance levels drawn at $237.66 and $262.39, based on prior consolidation zones. Initial support is at the 3-box level of $187.39, with further support at $176.58, and a broader support band between $156.80 and $153.73. AbbVie currently holds a perfect SMAX score of 10 out of 10, signaling that it is not only outperforming its peers in the drug sector but also excelling across other asset classes.
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