Shares of healthcare REIT Welltower may have put in a major bottom.
WELL began this week with a 2.2% gain putting it in the top 10 S&P 500 gainers list. This impressive move, on accelerating trade, pushed shares to new March highs. After a extremely deep pullback from the 2017 peak, which drove shares over 20% lower, WELL is setting up for a healthy rebound. In the near term investors should take on a much more positive view of the name.
At the early March lows WELL was the furthest its been below its 40 week moving average since early 2009.
Since the mid February low the stock has been tracing out a bullish divergence in its daily MACD indicator.
WELL now has a very solid support zone nearby. The top band is marked by the initial March high($54.20)as well as last week’s high($54.05). On the downside, a close back below $52.20 would clearly violate last week’s low sending a clear warning sign that a more drawn out basing process is ahead.
Initial upside target is the declining 50 day moving average currently resting at $57.55.
We do not have a position in WELL.