I agree with your prognosis. Once it breaks through the support at $16.00 ( $15.49) there are no additional support levels.
I really don't see what happened to CLDN today happening to HALO but that doesn't mean there is some turbulence and possible disappointments ( and failures) along the way. I have come to expect it with biotechs. I am looking at other possible biotech candidates for investment and I am sure some of them will be failures but when you get a winner it is a gold mine.
Most of the small biotech companies do not do much in the way of investor support (like updates on trials). They wait like CLDN did and announce the trials failed to meet the endpoints. Or they announce that trials were a success. That's the way it is with biotech investing.
I agree on the CLDN reaction. Investing in biotechs is not for the faint of heart. I almost bought CLDN a few weeks ago. Sure glad I didn't get in on that one.
They already filed the shelf registration. The shares are now available to be sold by private placement at the price to be determined at the time of the placement. I doubt it but it is possible that the placement has already been arranged. From the company's perspective they may want to collect as much cash as possible before the results are announced. It is possible that the results are good but not well received by the analysts. it is safer to wait for the dust to settle before committing additional cash.
Since they filed the shelf registration I would think the pricing of the shelf would determine the support level (unless they announce results prior to the pricing).
Huge open interest today on April 12 puts. It looks like someone with deep pockets wants to push Brocade down over the next twenty plus days.
almost all of the BDC's are down today. Maybe the potential interest rate increase from the Fed is causing the sell off.
I am looking for a close today at $2.75. Volume is very good but there are day traders piling on that will close the position before the end of the day. This could be a good place to add shares.
There are only three possibilities that I can think of: (1) stock is being manipulated by selling at the bid to drive out weak hands and then add to the position on the cheap or (2) short sellers jumped on the offering news and continue to pressure the stock by selling additional shares short or (3) a large institutional holder wants to reduce or close their position. My guess is an institutional holder wants out.
They will have a real hard time floating another secondary after the last buyers were burned. I don't see any way they had a chance to sell the positions for a profit before the bottom dropped out.
26.89 was the value of RGP at the time of the announcement (.4066 X price of ETP at that time). If ETP is trading at $40 at the close of the merger then RGP shareholders will get 16.26 per share (in ETP stock). That's why I am voting against the merger.
I also have no position but the large private placement coupled with a analyst upgrade is enough for me to be wary.
I was going to take a position this morning but I am wondering about the coincidence of a large private placement followed by an analysts upgrade. I am going to watch and wait. If I am wrong then good for you guys!