Weekly thought on $AMRN, $ARTH, $BIOC, $CARA, $DMRC

While not a great green weekly bar, it was still a decent one.

SP-500_weekly

Price barely closed above the downtrend line. so the bull must work hard next week so as not to give up the momentum to make new historical high.

$AMRN continued higher with a solid green weekly bar.

AMRN_weekly

Per my prediction last week, last week doji bar was indeed the “pausing before continuing” bar.  This week closing is important ’cause price is now above the $1.84 resistance as well as being above the 79 MA resistance.  Next resistances are now at $2.06 and $2.15.  Meanwhile, the interim data review is ongoing and we may know something by 2nd-half of this year to see if Amarin’s Reduce-It trial will be halted due to efficacy.

Giving 200 million statin prescriptions are written annually, even if doctors prescribed Amarin’s Vascepa along with 10% of this 200 million statin prescription due to successful Reduce-it trial result, $AMRN will surely becomes BP in its own right.  Anyone knows the average market cap of BPs?  Now compare this market cap to Amarin’s current market cap.  Don’t you want to own some shares for a bet that can give you a superb return with risk that is acceptable due to past successful trials such as the Japanese Jelis Study as well as other EPA related studies already available.   Of course, all these other studies do not guarantee Amarin’s Reduce-it will succeed but it definitely reduce the “risk” to a more palatable and acceptable term.  In other words, IMHO, the risk/reward for taking the trade in $AMRN is mind-blogging in favor of the long side.

$ARTH, while bounced slightly after last week profit-taking, stopped the last week downward momentum. There are still a couple of months before summer so price may continue to be volatile unless preliminary positive trial news are released to keep price going higher and higher.

ARTH_weekly

Notice price is now near the top of the 2-1/2 years consolidating range .  With human trial result to be released this summer, I can see price breaking out of this 2-1/2 years range and shooting up like a rocket to the blue sky above.  I’m curious if there will be immediate buy-out offers once the proof-of-concept is established successfully this summer.

$BIOC also bounced higher this week as well.

BIOC_weekly

I believe price is on track to continue on the 3rd wave of the Elliott Wave Theory.  The coming earning update will show how quickly Biocept is gaining more revenues from selling their liquid biopsy diagnostic tests to doctors and hospitals.  A surprise increase will help boost $BIOC back to above $2+.

$CARA suffered profit-taking correction after receiving FDA approved to continue on their I.V. CR845 phase 3 trial.  From the daily chart below, price shot up to $9 on FDA approval which is where the 79 & 89 MAs were hovering as resistances as well.  Seeing imminent profit-taking, I also sold more than 50% of my position to lock in gain.  I also began buying back shares Thursday and Friday.

CARA_dailyFrom the daily chart above, I’m seeing major support at $6.5x and expect to see some bounce next week.

I got back into $DMRC this week due to the formation of last week doji bar (see circle in weekly chart below).

DMRC_weekly

Since last week doji bar appeared next to support, I began to buy back shares this week.

During the week, I also bought and sold $SKLN.  After witnessing a huge amount of shares available at the ask in Level 2 market data, I decided to unload my position for small losses after holding two days.  For some reason, there are A LOT of shares being offered which practically put a damper to any rally that popped up.

Overall, my port has another strong week. Thanks to $AMRN and $CARA, my port is now a stone-throw away from recovering last year losses.

My 2 cents.

From my camera:

067

 



Categories: Daily trading Journal, trading journal

Tags: , , , , ,

4 replies

  1. Hi, Im fairly new to technicals. It would be helpful at some point if you could outline what all your lines mean. Thanks

  2. Re Arth: Im not sure how useful these technicals are at this point. As you say, human trial results could break anytime soon which should have a big effect (up or down) I think this is a dangerous time to actively ‘trade’ the stock coz with one announcement, you could be left eating its dust. I cannot see how ARTH can fail the trial (famous last words!), coz 3Dmatrix (essentially the same stuff) has already got its CE mark and its marketing the product in UK/Ireland (with poor take up presently). But you can bet your boots Norchi and pals have tried AC5 out on their own shaving cuts. If there was a problem, they would have delayed the trial…..why waste money trialing if you know its gonna fail ?
    Long ARTH.

    • Hi Alan,

      Thank you for sharing your thought here. While technical analysis cannot predict fundamental development, it does reflect the sentimental of the buyers and sellers of the stock. Price is currently trading at a level carved out by the buyers and sellers. The fact that price is now trading at the upper range of the 2-1/2 years of the consolidating range means the net buyers are anticipating an event that will eventually cause the stock to explode one way or the other. Of course, giving the price is at the upper trading range, one can deduct that the expectation of the breakout is on the upside.

      Thus, if I am to browse the weekly charts of various stocks and come upon a trading pattern similar to what Arch is now (price trading at the upper-range of a 2-1/2 years consolidating period), I can assume (with a high degree of accuracy) that the general investors of the stock is expecting a binary event to cause a breakout soon without even knowing what the company is selling.

      In a nutshell, the technical analysis of the chart is not about predicting where price is going, it is ALL about reflecting what the buyers and sellers of the stock is thinking with their speculative funds. Notice that the correct way to understand the famous chart patterns such as Head & Shoulder breakout, cup & handle breakout, symmetrical triangle breakout, etc is to wait for “confirmation” of the breakout. In other words, just because a famous pattern is showing up on the chart (before any confirmation of a breakout) doesn’t mean there is a good probability of a breakout. However, a “confirmed” breakout of a famous pattern means the probability of the trend is high on the direction of the breakout. Translating back to investors’ perception, a breakout of a famous pattern means there is a significant event that caused the breakout. And in all likelihood, this significant event is also the fundamental reason for the price to continue on the direction of the breakout.

      Thus, in the case of Arch, a breakout to the upside mean the human trial is a success. With this major proof-of-concept established, the likelihood of continuing price appreciation is high due to the potential revenues streams coming from a new technology that is going to change the way surgeons and doctors perform their duties. Thus, without even knowing what Arch is doing, a breakout of the consolidating range that spanned 2-1/2 years means a successful significant event took place that will change the dynamic of the company in term of being able to generate significant revenues stream down the line; hence the continuing long-term uptrend in the direction of the “confirmed” breakout.

      I hope I’m not making you even more confused with the above explanation…

      Cheers!

  3. ARTH: Sorry to keep blathering…. I dont think Norchi wants to be 100% bought out, but he IS on record as saying that given his cash position and just 5 employees, he will be actively looking for a partner pdq once he’s harvested the low hanging CE mark fruit. He’ll need a significant cash injection to both market AC5 in the EU etc and fund US trials.

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