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TM Editors' note: This article discusses a penny stock and/or microcap. Such stocks are easily manipulated; do your own careful due diligence.

• Femasys share price has surged to the highest point since October.
• The FDA approved its FemaSeed product this week.
• There is hope that the agency will approve FemBlock, its birth control product.

Femasys (FEMY) stock price has made a strong comeback in the past few days as investors cheer the company’s FDA news. The shares surged to a high of $1.71, the highest level since October last year. They have soared by more than 320% from the lowest point this year.

Femasys FDA approval

Femasys is a small biotech company that does research on women’s reproductive systems. The product’s goal is to provide a non-surgical, proprietary delivery system that ensures high efficiency and lower costs to users. 

Femasys has a pipeline in key areas. Its FemBloc product is in the contraception industry while FemaSeed, FemVue, and FemCath are in the infertility industry. FemCerv are in the biopsy sector. Its infertility and biopsy products are already approved and available commercially.

Femasys stock price surged this week after the FDA granted a 510(k) clearance for FemaSeed, which works by delivering sperm directly to a woman’s fallopian tube. In a statement, the company’s CEO, Kathy Lee-Sepsick, said:

“This FDA 510(k) Clearance of FemaSeed demonstrates our successful collaborative efforts with the FDA to bring forward new technology that will address the significant unmet need for less burdensome infertility treatments.”

Femasys also believes that the FDA will also approve FemBlock, a product that offers permanent birth control and ultrasound occlusion confirmation. The product is now in the second stage of the clinical trial. 

The most recent results showed that Femasys revenue rose to over $320k in the three months to June 30th. It made $303k in the same time last year. Its net loss jumped to over $2.8 million. 

Femasys stock price forecast

(Click on image to enlarge)

The daily chart shows that the FEMY stock price has been in a bearish trend in the past few months. It has dropped by more than 90% from the highest level on record. Along the way, the shares have formed a descending channel shown in red. 

Now, the shares have soared above the upper side of this channel and reached the highest point since October. They have also soared above the 50-day and 200-day exponential moving averages (EMA). 

The Relative Strength Index (RSI) and the MACD have drifted upwards. Therefore, I suspect that the shares will be more volatile in the coming days as some initial buyers start taking profits.

As such, the shares will likely retest the crucial support level at $1, ~33% below the current level. A break below $1 will see it retest the upper side of the channel at $0.7200.

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