Biotech Stock Looks Like Is Has a Great Set Up
Contributed Opinion

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We are looking at Hemostemix Inc. (HEM:TSXV; HMTXF:OTCQB; 2VF0:FSE) here because it looks like a great setup.

First, provide a little background so that you understand what kind of company this is. The following is lifted straight from the homepage of the company's website. . . 

"Hemostemix is an autologous (patient's own) stem cell therapeutics company that holds 91 patents on the derivation of three stem cell lineages from the patient's blood, including angiogenic cell precursors (ACP-01), neuronal cell precursors, and cardiomyocyte cell precursors. ACP-01 have been used as a treatment of 500 subjects, studied in including clinical trials, and are demonstrated to be completely safe and effective as a treatment of Angina, Dilated and Ischemic Cardiomyopathy, Peripheral Arterial Disease, and Critical Limb Ischemia. Drawn from your blood, differentiated into ACP-01, and reintroduced into your heart by your physician seven days later, for example, ACP-01 forms new circulation where the body signals it needs regeneration. It's why we globally trademarked "Your Fountain of Youth!"

You can find out as much as you wish by perusing the company website and reading news releases, etc. — here, we are going to concentrate on the stock charts.

Starting with the 6-month chart, we see that the stock broke out of a base pattern into a powerful upleg driven by strong volume in January. This is clearly very bullish, especially as volume dropped right back on the normal reaction towards the strong support above the breakout point that has followed with On-balance Volume resilient on this reaction, and now upside volume is starting to build again ahead of another upleg that is expected soon.

The 2-year chart reveals that the base pattern of the price that broke out in January was a large Head-and-Shoulders bottom.

Whilst the price could theoretically react back further near-term towards the breakout point, this does not look likely given the strength of the volume pattern and the resilience of the On-balance Volume — instead, the strong upside volume starting to appear again in recent days that can be seen on the 6-month chart suggests that another upleg is likely to start very soon that is likely to be sizable.

The long-term chart and 6-year chart enable us to see that last year's base pattern looks like part of a larger Cup base. If a "Handle" does form to complement the Cup, then it would involve a trading range probably bounded by about CA$0.15 on the downside and CA$0.40 on the upside.

Even if the price gets stuck in such a range for a while, we are looking at it more than doubling from here just to get to the top of this range, and probably in short order.

Hemostemix Inc. is therefore considered to be at a very favorable entry point here and rated an Immediate Strong Buy.

Hemostemix Inc.'s website

Hemostemix Inc. (HEM:TSXV; HMTXF:OTCQB; 2VF0:FSE) closed for trading at CA$0.12, US$0.08915 on March 11, 2025