Merck & Co. (MRK) is a multinational pharmaceutical company with several best selling medications under its portfolio.

Merck

It researches, develops and produces various medications, vaccines and biological medications in diabetic, cancer, infectious diseases, immunological diseases. MRK is listed on NYSE and is a component in DJI and S&P 500 under Healthcare.

MRK was moving in a range between $69 and $83 since September 2021. After a Wyckoff upthrust, the price gapped down on 5 November 2021. It then drifted back to test $69 with increased volume. However, comparing the bar spread of 29 November and 5 November, there was less down move with similar volume. This suggests there is absorption of the supply. And true enough, as a sign of follow through, the price rebound from $69 and rally up.

Price formed a higher low in late Feb 2022 and started a very gentle Wyckoff sign of strength (SOS) rally. It broke above the axis at $83 and hit $99 on 11 April.

The price then pulled back to retest $83 before another sign of strength rally to reach $93 on 17 May, forming the Wyckoff buying climax (BC). An automatic reaction (AR) brought the price back to $83 as a Wyckoff change of character to define a new trading range between $83 and $93.

On 17 June, although the doji bar is small body, the spike of volume suggests the presence of demand. The price attempted another rally and hit $97 on 27 June. However, it formed a Wyckoff upthrust and retraced back into the range. The volume during this period was relatively lower compared to November 2021 suggesting a calm Wyckoff accumulation phase.

The price moved within the range until a gap up on 10 October to rally until $101.50 on 27 October. Subsequently, it retraced gently to test around $98.    

Bias

Bullish. MRK price had accumulated since early 2019. According to the Wyckoff trading method, the price structure is bullish and likely will attempt another rally to test $101 with enough causes built over the years and lack of threatening supply.

However, if price is unable to commit above $98, it may retest $93 and form a new trading range between $93 and $101. Recent volatility in the market makes it hard to find winning stocks. Therefore it is essential to focus on those outperforming stocks that stand out like a sore thumb in this market in order to gain an edge. 

More By This Author:

Would Boeing Continue To Soar Or Crash?
Is Microsoft Giving In To The Bears? A Wyckoff Analysis
Here Is How To Tackle Bullish Price Volume Action Vs. This Bearish Analog