MRNS Stock: Price Action Suggests Further Gains
I have stumbled upon a small biotechnology investment in Marinus Pharmaceuticals Inc (NASDAQ: MRNS) stock.
The reason why I find this investment intriguing is no different than the reason why I find most companies intriguing; it has everything to do with the price action and indications on the Marinus Pharmaceuticals stock chart.
For the those not familiar with my style of investment analysis, let me briefly explain. I use technical analysis, which relies on past volume and price data in order to understand the direction that a stock is moving in. It sheds some light on what the future may bring. Two decades is how long I have been applying this method, and I feel I am well equipped for the task at hand, which is analyzing the MRNS stock chart.
I am intrigued by a particular pattern that has been painted on the MRNS stock chart. This pattern is highlighted on the following Marinus Pharmaceuticals stock chart.
Chart courtesy of StockCharts.com
The pattern painted on the MRNS stock chart is an ascending triangle.
An ascending triangle is a consolidation pattern that is characterized by price action which consists of higher lows and a static high. This pattern is best identified using two converging trend lines, where one line represents price resistance while the other represents price support.
As the pattern develops, the range between price support and price resistance begins to contract. This contraction of space causes energy to build within the pattern , which will finally be released once the pattern is resolved. As a result, triangle patterns are particularly powerful patterns.
On December 14, MRNS stock exited the ascending triangle pattern, which implies that the pattern is complete. The completed pattern suggests that a move toward higher prices is now in development. The repercussions suggested by the pattern remain intact as long as Marinus Pharmaceuticals stock doesn’t fall below the upward-sloping trend line that defines this pattern.
Taking the completed triangle pattern within the context of the larger trend can help shed some light on where Marinus Pharmaceuticals stock is heading next. The larger trend is illustrated on the following MRNS stock chart.
Chart courtesy of StockCharts.com
This MRNS stock chart illustrates a bullish trend that began late last year, which has been characterized by the quintessential characteristic that defines all bullish trends, which is a series of higher highs and higher lows. This bullish trend has been responsible for taking MRNS stock price from a low of $0.82 to high of $9.87, representing a 1103.7% return in a year’s time.
This bullish trend has been constructive in nature, which means that the current trend is sustainable. Sustainable bullish trends contain two distinct waves: an impulse wave and a consolidation wave.
The impulse waves, which are highlighted in green, define the period in a bullish trend when the stock price advances in very short order.
The consolidation waves, which are highlighted in purple, define the period in a bullish trend when any overbought conditions that were created in the impulse waves that preceded it are unwound. This wave is extremely important, because it establishes the necessary conditions for new advancing impulse waves to follow.
The completed ascending triangle doubles as a consolidation wave, which suggests that a new impulse wave is now in development and that, therefore, higher Marinus Pharmaceuticals stock prices are on the horizon.
The previous all-time high resides at $20.72, and the completed consolidation wave suggests that MRNS is one step closer to reaching that peak once again.
The completed ascending triangle on the Marinus Pharmaceuticals stock chart suggest that higher prices are now in development. As a result, I am bullish on the prospects of this investment heading forward. I will remain bullish on MRNS stock until there are indications suggesting that a bullish view is no longer warranted.