Retail interest in Cassava Sciences (NASDAQ:SAVA) remains far from over. The stock gained more than 6.7% on Wednesday, catapulting it to a 76% increase in value in a month. The Wednesday gains came as a result of improved sentiment in Biotech stocks Biogen Inc. and Eisai Co. Ltd. Both companies had, on Tuesday, announced positive results from a late-stage Alzheimer’s treatment study.
No hard math to explain the double-digit returns for Cassava Sciences. The company has this year been marred by controversy over the manipulation of research data for its Alzheimer’s drug. However, last month, the Journal of Prevention of Alzheimer’s Disease acquitted Cassava Sciences of wrongdoing. Lately, the US SEC recommended an end to Cassava’s investigation on the Simufilam study.
The positive developments have been boosting Cassava Sciences stock. The prospect of an Alzheimer’s drug is monumental for Cassava as the condition has proved difficult to treat. But with a single drug in its pipeline, Cassava needs to convince investors of its worth and get rid of a meme tag.
Cassava Sciences initiates a breakout from a descending channel
Source – TradingView
On the technical front, Cassava Sciences is bullish after breaking above the descending channel. The stock has been on a downtrend since November 2021. The RSI is coming from an overbought zone, but the stock’s momentum remains high. The stock is a hold up to the resistance zone at $62.
Should you buy it now?
Investing in Cassava sciences, you should know that it is largely driven by retail interest. The stock can post further returns to the $62 resistance. Investors can buy on the retracements but be aware of quick volatility changes on the stock.
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