Over the past couple of months a key support level was formed in the chart of FibroGen Inc. (FGEN - Get Rating).

FGEN is a biotechnology company focused on discovering, developing, and commercializing novel therapeutics to treat serious unmet medical needs. The company recently announced the initiation of LELANTOS, a Phase 3 trial of pamrevlumab in combination with systemic corticosteroids in patients with non-ambulatory Duchenne muscular dystrophy.

Take a look at the 1-year chart of FGEN with added notations:

(FGEN - Get Rating)

As of the open this morning, FGEN is just 2% away from $40.  A move under this support level could be coming soon.

If that were to happen, a trader could enter a short position with the expectation that FGEN will have a breakdown.

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FGEN shares were trading at $40.88 per share on Wednesday morning, down $0.86 (-2.06%). Year-to-date, FGEN has declined -4.69%, versus a 8.15% rise in the benchmark S&P 500 index during the same period.

About the Author: christian

Christian is an expert stock market coach at the Adam Mesh Trading Group who has mentored more than 4,000 traders and investors. He is a professional technical analyst that is a certified Chartered Market Technician (CMT), which is a designation awarded by the CMT Association. Christian is also the author of the daily online newsletter Todays Big Stock. More...

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