I'm out after the huge rise. For the time being, I'm in something else until this gets back down somewhere near the gap it should try to fill from October 17th in the upper 11's. All of the evidence indicates it's heading there. The only wild card that I think can prevent it is unexpected good news. JP Morgan upgraded it right at the top, and after the initial reactionary upgrade gap up in the first 20 minutes of trading, the reality of the typical third day uptrend reversal kicked in. It finished right at the low of the day. Many would say that it just did what the whole market did that day. But, if that was the reason, then why did the downtrend continue on Friday while the rest of the market soared and finished at its high of the day (especially the NASDAQ...up 1.6%!!!!). The share volume was large, too. Some of this was obviously buying by folks who are going to hold this long-term, which I think is very smart. I'm sure it's going A LOT higher! But, I also think the stock should have performed MUCH better on such a big up day for the market with that large volume if it was going up from here. I think lower prices will be coming next week, barring some big positive news, of course. It's just behaving like it needs to fill that gap and is being taken down accordingly, IMHO. Look at the three-month chart and notice the gap fills after EVERY uptrend. I would never short it and hold overnight because of the ever-present danger of unexpected good news, but I'm hoping to get back in below 12 next week. If the down-trend does continue, margin calls will kick in for the people who bought on margin at higher levels. This will obviously enhance the down-trend and make it even more likely to hit the upper 11's. I don't like seeing anyone lose money because of situations like this, and it happened to me many times before I started to learn about gap fills and the very common three-day uptrend that happens after great earnings or other announcements. GLTA!
My call is looking pretty good right now, despite Mr. "pereperogie"'s insults. Oh, I should admit that it DID go up a penny before it started to decline. Obviously I agree with your estimate. Just have to be patient. It may not get there today, but barring good news, it sure looks like it will some time tomorrow.
Sentiment: Strong Buy
Thanks for your analysis - truly. Enjoyed reading it. Always looking for charting education. Your thesis looks spot on except that it looks to me like the gap fill this time is just below $12; not $11.50. If it does continue downward, and that is a big if, I will start buying more around $12. And notice that the run that started in late June did not come back all the way to fill which by my reading would have been around $8. Dropped back only to around $8.50 and that was two months later!. And the news just released creates a different paradigm now. The more robust data is in these startup biotech's, the more difficult manipulation becomes. Good luck to you.
I am grateful I don't have your's and istudyfish's problem. It would drive me crazy to think about these penny movements all day to maximize a little profit. I guess you agree if you loaded up in the 1.50 range in April 2012 you wouldn't have that problem either. Good dd just goes over good ta analysis especially in biotech.
I agree with everything you said, and I especially appreciate your civil and informative feedback. Oftentimes, posts like mine are slammed with degrading rhetoric based on nothing but unsupported opinion and insults. Some gaps do indeed never get filled. However, a high percentage of them do, although as you mentioned, it can sometimes take quite awhile for it to happen. As I stated below in feedback to comments from others, none of us knows where any stock is headed in the very near term. If we all knew, we'd all be rich and we'd be sitting on our yachts, not hanging around on Yahoo message boards...LOL. I based my opinion on what I observed about the stock's behavior last week and some classic technical analysis. But, news almost always trumps technicals in the short-term. So, we'll just have to see if the shorts can take this down to technically meaningful gap areas or if the recent great news keeps the stock from revisiting the upper 11's or 12 area. I didn't say that the gap was at $11.59 because I don't know what the high of the day was on Oct 17th. Having said that, most gap fills do seem to be based on closing prices, not intraday highs. But, just to be safe and not penny-wise and pound-foolish, I always put my limit orders in a little higher than where I think the gap fill or retracement point is so that I'm more confident that I won't miss out on getting relatively cheap shares. That's why, in this case, I said I'd be looking to buy under $12. A perfect example of this is OXBT, which is the stock I'm focused on right now. It went from $1.50 to $11.40 in eight trading days, culminating last Wednesday. It then dropped like a rock all the way back down to $7.7999 Thursday morning. As I was watching the sp jump around, I suddenly realized that the Fib 50% retrace from $11.40 was $7.70. So, it had bottomed just 9.99 cents above that. I immediately impulsively bought in at $6.29, but should have waited for a retest, which it did twice. It hit 7.50 on Friday. :-)
Sentiment: Strong Buy
I agree with you on some levels. There will be profit taking and yes the stock falls after a large 2 or 3 day rise. Usually though it forms a new higher base. I'd say that base is going to be in the 11.50 -12.50 range. The problem is as Pete said timing these changes puts you at risk of missing out on upside that could come at any time. Such as Japan approval data. But good luck either way.
Your narrative would be correct except for one little thing: anyone with half a brain knows this is going to be a drug of choice in the Nephropoly community, is going to trend up over the coming months AND that a buyout could come at any time. Selling now is taking a chance on missing a big payday on a buyout and short squeeze. Bottom line: the only time you lose money is when the pps retreats and you sell. I've been here since way before the perifosine failure and have seen MANY retreats in the price and have NEVER sold a share and consequently have NEVER lost a dime. My 31,000 shares were purchased for an avg pps of just under $3. Do the math. Then go fishing.
Stay thirsty my friends.
Sentiment: Strong Buy
Yeas, you keep 31,000 and didn't loos any dime, but trading portion of your KERX's asset in the long way between $3 and $12 your asset could be increased up to 20-25% higher, minimum. Yeas,this is risk, but not high, compared to fishing...
Sentiment: Strong Buy
GEEZ, you obviously didn't really absorb much of what I said at all! I mentioned that people who bought on margin near the higher levels may be forced to sell some of their holdings IF the down-trend continues. I also said TWICE that I would NEVER short a stock like this and hold overnight because of the possibility of unexpected great news. I NEVER told anyone to sell because the share price may take a TEMPORARY dip to fill its gap. I just think the evidence indicates that I'll be able to get in at better prices this week. I also stated that I thought everyone buying in the 12's is being very smart for the long-term. OF COURSE I could be wrong about this next week, and I stated that all was IMHO. That's what makes a market. If it was as easy as you say, then EVERYONE in the stock market with at least with half a brain would be a millionaire. Just because you held so long DOESN'T mean that you were eventually guaranteed to make money. A great recent example: Amarin. Looked like a complete no-brainer going into the FDA ADCOM meeting according to just about every major analyst, even after the critique that was issued by the FDA the week before the ADCOM meeting. TONS of very intelligent people got annihilated on that one. I know people who held it for YEARS that lost tens and hundreds of thousands of dollars on that one. The company exceeded every metric that the FDA set up for them in that trial for a drug that they had ALREADY approved for patients with very high levels of triglycerides two years ago. All they were asking for was to expand the patient population to people with moderate levels of triglycerides. But, the FDA pulled the rug out from under them and moved the goal posts TOTALLY unexpectedly at that meeting. The stock went from 7+ down to 5+ after the critique was released and then down to 2+ after the negative ADCOM vote. It's now at $1.57. Maybe it eventually makes it back to $7, who knows? But if it does, it may take years. I also said GLTA!