Halyard Health's Daily Chart Shows a Potential Tradeable Near-Term Bottom

NEW YORK (The Street) -- Healthcare supplies provider Halyard Health (HYH) became a publicly-traded company at the end of October as a spinoff from Kimberly-Clark (KMB). Shares of Halyard began slipping immediately, falling to as low as $35.56 on Nov. 5, then began to rebound. Once the stock had been traded for 50 sessions the 50-day simple moving average could be tracked. This moving average held as a technical support between Feb. 20 and March 6, and the stock traded as high as $50.91 on April 9.

On May 5 the stock gapped below the 50-day average, and it traded as low as $41.25 this morning.

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This volatility prompted Jack Mohr, Director of Research, Action Alerts PLUS, to send us a Tweet: "Fingers crossed but I think we may have found a bottom in Halyard- yesterday. At v least it's not going under $40. Steal @ this price."

Here's an analysis of the daily chart, which suggests that Jack could be correct. Keep in mind that, because it's a newly-public company, historical data for Halyard is limited. 


Courtesy of MetaStock Xenith

Tuesday's price action for shares of Halyard Health is a potential key reversal. After setting a low of $41.25 this morning, a close above Monday's high of $42.30 would be a key reversal. By definition, higher closes on Wednesday and Thursday will confirm the reversal and indicate a potential tradeable rebound to the 50-day simple moving average of $47.52.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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