Chembio Diagnostics, Inc (PINK:CEMI) is supposed to file its 10-Q for the first quarter of the year today and yesterday the stock entered the market with a gap up in anticipation of the event. Two days ago, the company also announced the regulatory approval to market another product in Brazil, thus no wonder that CEMI is again quickly up after the drawback.

Yesterday, CEMI gained 3.70% in value and closed at $0.56 for a share. The intense activity before the filing of the latest financial results caused a volume of over 358,000 traded shares, more than twice the daily average of 162,000. RSI is pointing up and MACD line have made a bullish cross, all suggesting that CEMI could easily break the next resistance at $0.58, which appears to be also the 52-week high, and face a blue sky breakout.

A prerequisite for that to happen, however, is that the 10-Q delivers no unpleasant surprises to investors and that the company has kept the positive trends from the past quarters. CEMI generates revenues from the sale of diagnostic tests and other related products, as well as from milestone payments and grants. Revenues showed stable growth and reached $5.6 million in the last quarter of last year and the company reported a record net income of $1.88 million, compared to a total of $633,000 for all of the previous three quarters. CEMI also had as of the end of last year no substantial debts.

This Tuesday Chembio Diagnostics said that Bio-Manguinhos, the company’s Brazilian partner, has received regulatory approval from Brazil’s National Health Surveillance Agency to market Chembio’s Dual Path Platform (DPP®) Syphilis Treponemal test. Under the agreement, Chembio is expected to receive $5.7 million from the sales of two Syphilis products in Brazil over the three years starting November 2010.