2 Robinhood Medical Favorites Are Looking Healthy

The SPDR S&P 500 SPY hit a new all-time high Wednesday morning amid a week where many of the biggest tech companies report earnings.

A boom in big board names is often followed by a rotation. This rotation usually has a trickledown effect where mid-sized companies are next to get a boost followed by juniors and penny stocks.

Aikido Pharma Inc AIKI and Brickell Biotech Inc BBI made their last highs after the end of the fourth-quarter earnings season in February, reaching $2.55 and $1.70, respectively.

Aikido and Brickell are also two heavily traded penny stocks in the Robinhood community.

See Also: Best Biotech Penny Stocks

The Aikido Pharma Chart: Aikido’s stock is down almost 60% from its 10-month high it made on Feb. 16. It looks to have put in a bottom at the 80-cent mark and by Wednesday morning had rebounded 32% from that level to $1.03.

Aikido is trading above both price history resistance and psychological resistance at $1. It's also trading above both the eight-day and 21-day exponential moving averages (EMAs) which is bullish. The eight-day EMA is currently trending under the 21-day EMA and bulls would like to see the eight-day EMA cross above the 21-day EMA for confidence that stock will go higher.

Bulls want to see the eight-day and 21-day EMAs continue to support Aikido’s stock and for bull volume to come in and push it back over resistance at $1.21. There are two gaps overhead, from $1.45 to $1.50 and from $1.75 to $2. Gaps fill 90% of the time and if Aikido can clear the $1.21 level, it has room to move up and fill the lower gap before reaching another resistance level.

Bears want to see Aikido lose resistance at $1 which would push it back below the eight-day and 21-day EMAs. If the stock falls under $1, it could retest 80 cents before finding another support level.

The Brickell Biotech Chart: Brickell’s stock reached a new high on Feb. 10 and on Feb.11 the stock rejected from the same level creating a bearish double top pattern. Brickel’s stock plummeted 53% in the weeks following the double top pattern before finding a low near the 80-cent mark.

On Tuesday Brickell’s stock was able to pop up over resistance at $1 and trade above both the eight-day and 21-day EMAs. Like Aikido’s stock, Brickell’s stock has the 21-day EMA trending above the eight-day EMA and bulls would like to see the eight-day EMA cross above the 21-day EMA for more confidence.

Brickell could be setting up the right shoulder of a bullish inverted head-and-shoulder pattern over the coming days which would cause a slight downtrend in the stock before possibly making a larger move north.

Bulls want to Brickell’s stock complete the inverted head and shoulder pattern and/or for it to move up over its next resistance level at $1.16. If the stock could clear that resistance level, it could move towards the $1.30 mark before meeting another resistance level.

Bears want to see Brickell’s stock drop below $1 and negate the inverted head-and-shoulder pattern. If the stock can’t hold $1, it could fall back to the 80-cent level before finding support.