MiMedx (MDXG) Just Flashed Golden Cross Signal: Do You Buy?

From a technical perspective, MiMedx Group, Inc (MDXG) is looking like an interesting pick, as it just reached a key level of support. MDXG's 50-day simple moving average crossed above its 200-day simple moving average, which is known as a "golden cross" in the trading world.

Considered an important signifier for a bullish breakout, a golden cross is a technical chart pattern that's formed when a stock's short-term moving average breaks above a longer-term moving average; the most common crossover involves the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.

Golden crosses have three key stages that investors look out for. It starts with a downtrend in a stock's price that eventually bottoms out, followed by the stock's shorter moving average crossing over its longer moving average and triggering a trend reversal. The final stage is when a stock continues the upward climb to higher prices.

This kind of chart pattern is the opposite of a death cross, which is a technical event that suggests future bearish price movement.

MDXG could be on the verge of a breakout after moving 10.3% higher over the last four weeks. Plus, the company is currently a #3 (Hold) on the Zacks Rank.

Looking at MDXG's earnings expectations, investors will be even more convinced of the bullish uptrend. For the current quarter, there have been 2 changes higher compared to none lower over the past 60 days, and the Zacks Consensus Estimate has moved up as well.

With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on MDXG for more gains in the near future.

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This article originally published on Zacks Investment Research (zacks.com).

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