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Possible Bullish Inside Day Candle Pattern Detected for Depomed (NASDAQ:DEPO)

By Shiri Gupta

SmarTrend's candlestick scanner has spotted a possible bullish inside day candle pattern in Depomed (NASDAQ:DEPO) based on the price action in the company's shares. Yesterday's price range of $19.45 and $19.98 is within the prior day's high and low of the day. This trading action often signifies indecision by bulls and bears to drive prices higher or lower and often implies a possible change in trend. Traders and investors interested in shares of Depomed may want to consider an appropriate entry level in the event a reversal to the upside transpires. It is important to look for confirmation.

DepoMed, Inc. develops new and proprietary oral drug delivery technologies. The Company has developed a system designed to be retained in the stomach for an extended period of time while it delivers the incorporated drug or drugs. DepoMed has also developed a system designed to reduce gastrointestinal irritation.

Depomed has overhead space with shares priced $19.54, or 33.0% below the average consensus analyst price target of $29.17. The stock should hit resistance at its 200-day moving average (MA) of $19.87, as well as support at its 50-day MA of $15.49.

Over the past year, Depomed has traded in a range of $12.25 to $33.74 and closed yesterday at $19.54, 60% above that low. In the last five trading sessions, the 50-day moving average (MA) has fallen 0.2% while the 200-day MA has slid 1.6%.

SmarTrend recommended that subscribers consider buying shares of Depomed on May 17th, 2016 as our proprietary SmarTrend analytics indicated a new Uptrend was in progress when shares hit $18.69. Since that recommendation, shares of Depomed have risen 3.7%. We continue to monitor DEPO for any potential shift so investors can protect gains and will alert SmarTrend subscribers immediately.

Keywords: bullish am inside day candle DepoMed

Ticker(s): DEPO