Biotech stocks are taking a bit of a breather.
The Nasdaq Biotech ETF, which is up more than 24 percent year to date, has dropped nearly 6 percent from its recent high set on July 20. But as some investors may view the pullback as reason to flee the space, one trader has his eyes set on one of the ETF's biggest holdings: Amgen.
"I really like Amgen ahead of earnings," technical analyst Todd Gordon said Wednesday on CNBC's "Trading Nation." Amgen is slated to report its fiscal 2015 second-quarter earnings results Thursday after the closing bell.
"Amgen consolidated for much of 2015 and we've recently broken out of this range," added Gordon, founder of TradingAnalysis.com. Amgen shares have rallied more than 13 percent in the past 30 trading sessions. "The stock has also broken through this resistance level at $166, and that should serve as support."
For Gordon, if that support level holds through earnings, the stock could move sharply higher. "Ultimately I think we can get up to the $180-to-$190 range in the stock." That's a 5 to 11 percent move from the current price of just under $172 a share and puts the stock at all-time highs.
But as the Biotech space proves volatile, Gordon recommended using options to get long the stock. Specifically, for investors looking to capture earnings, Gordon suggested selling puts at the 165-strike. And for longer-term investors, he recommended buy calls.
"Longer-term I think this is a stock that wants to break out and could go as high as $200," he added.
Amgen reports its fiscal 2015 earnings report Thursday after the bell. Analysts surveyed by FactSet are expecting the company to earn $2.43 per share on $5.3 billion in revenue.
Want to be a part of the Trading Nation? If you'd like to call in to our live Monday show, email your name, number and a question to TradingNation@cnbc.com