Weekly thought on $AMRN, $BIOC, $HIMX, $IBIO

I believe this week pretty much settled the fact that May 2017 is not going to support the “Sell in May and go away” myth. Myth because after including 2017, there will be 13 green monthly bar vs 8 red monthly bar since 1996. That is 62% up month compared to 38% down month. Below monthly SP500 chart reflected another solid green bar making new historical high.

SP-500_Monthly

As much as I would like to say my port is doing the same, I cannot.  The stocks I selected are still waiting for catalysts to form and most likely may happen in the 2nd half of 2017.  Also, I missed a couple of good picks that I had chosen but bailed out too soon; mainly $PI, $DMRC, and $OLED.  As far as I’m concerned, missing good trades in hindsight is a lesson to be learned and not to be regretted.  In the world of speculation, uncertainty is the norm and words like hope and regret have no place here because risk doesn’t give a hood about how you feel.  It simply rewards you or punishes you.  It’s that simple.  So, I prefer to use word like “expect” when it comes to direction of the price or the fundamental development of the stocks I picked.  When I expect something to happen and it doesn’t, it forces me to rethink my thesis that may or may not result in taking some action.

… and then there are four…

Last week I was down to two positions but I added two more this week.

I bought back $AMRN since price bounced right back up after reaching low of $2.90.  Look like last week high volume sell-off was a fluke after all.  With the result of the interim data review of the Reduce-it trial coming out in Aug/Sep, I think it is pointless for me to trade in-and-out of this stock at this point.  Trading in-and-out is not without cost. Sometimes, I got back in at higher price plus the additional commissions I had to pay.  Thus, I’m going to do my best to stick around and see thru the 3 Qtr.  I said “do my best” ’cause if there is a SP500 meltdown which I doubt, I may have to bail.

AMRN_weekly

I like the fact that the week closed with a doji bar.  A doji bar (or spinning top bar) reflected indecision by both bull and bear sides.  No one really won the battle for the week.  But with potential catalyst to come in August, I’ll choose to add more weight to the bull side.  Thus, I’m back in holding a position in $ARMN.

$HIMX closed with another spinning top this week.

HIMX_weekly

As mentioned above, it’s another indecision b/w the bull and bear side.  Despite its being a red spinning top, it came with lower volume so it’s still a stalemate.  Notice the small range as well.  As far as I’m concerned, price still has a high probability of a bounce due to the fact that this week small spinning top is still resting on the Fib 61.8% support.  Per my book, spinning top (or doji bar) at support has better than 50/50 of a bounce.

There were two spikes this week on Himax that attempted to reach $7 (Monday and Friday) but I didn’t sell ’cause I’m here for the long-term bullish trend.

Sidebar: my lesson in $PI taught me that short-term profit can easily derail me in achieving long-term gain.  The problem with taking short-term profit is that I have to overcome inertia to jump back into the game when price begins to take off.   I don’t know about you, but when price takes off quickly without me on board, I’ve to fight a huge mental battle of “should I chase it or wait for pull back?”  If I chose the latter, I might end up missing the whole bull run.  This was exactly what happened to me in $PI.  I chose to wait for pull back but it never came.  And each time, price moved higher, it became even harder to jump back in.  And when there were pull backs after price reached new interim high, I began to question if this pull back would continue southbound.  My point here is that it’s a tough mental battle to jump back into a stock that run away without me on board.  But if I’m already locked and loaded, I don’t have to deal with these decisions.  The only tough decision I’ve to make is when to take profit. And here is the nice thing about being indecisive about taking profit, as long as the stock continues to rally based on strong fundamental, any lack of action only helps the portfolio grows; whereas any indecision of jumping back into a running stock risks missing the whole train ride to the end of the rainbow.

Of course, the negative side of the buy and hold for long-term trend is that no one can buy at the exact bottom of the downtrend before the reversal to the upside.  Therefore, I’ve to take some heat when price is still waiting to bounce.  This is where I come to rely on the fundamental development of the company.  Also, from my experience with $PI, short-term trading can sometimes make you forget about the fundamental story of the stock.  Another side of the long-term hold is that sometimes I’ve to witness the disappearance of unrealized gain as price bounced around the entry point.

After re-reading the Himax 1st Quarter earnings transcript, I found that there were plenty of clues representing a brighter picture for the 2nd half of 2017 and beyond.  If I ever need a reminder of what Himax can bring to the table for our next generation tech in A/R, V/R, and 3D scanning, all I’ve to do is to re-read the excerpts below I copy/pasted from the earnings call transcript:

We believe 3D scanning is one of the most significant new applications for the next-generation smartphone.

The view is echoed by many industry researchers. We are now seeing strong demand for 3D scanning products from multiple top name customers who are either collaborating with us or engaging us for advanced-stage discussion. Thanks to our absolute technology leadership.

Our SLiM product line is a state-of-the-art total solution for 3D sensing and scanning based on structured light technology. We offer fully integrated structure light modules with vast majority of the key technologies inside also provided by ourselves. These technologies includes advanced optics utilizing our WLO technology, laser driver IC, high precision active alignment for the assembly of laser projector, high performance near-infrared CMOS image sensor and last but not least, an algorithm chip for 3D depth map generation.

Nevertheless, we have secured new design-wins, particularly in 4K TV to resume our larger panel driver IC business growth in the fourth quarter.

We remain the market-leader in the large panel driver IC business in China and will be a major beneficiary from China’s capacity expansion.

We are confident that our TDDI solutions and business will start to contribute in the third quarter.

Driver ICs used in automotive application has been the best performing category for us in recent years. We are seeing solid momentum in the second quarter with revenue to grow around 15% sequentially and over 50% year-over-year. Being the market share leader with numerous Tier-1 automotive brands as our indirect end-customers, we have successfully engaged all key panel manufacturers and module houses worldwide for long-term partnerships and secured many of their key projects pipelined for the next few years.

As mentioned earlier, the 18:9 screen format is increasingly popular among major smartphone players, especially for their mid-to-high end models. Being the front runner of TDDI solutions for 18:9 displays, we will benefit from the new trend.

Apart from smartphone and tablets, we expect the adoption of 3D scanning to widely spread over to various applications such as industrial, IoT, AI, medical, automotive, military, surveillance and drone. We will expand the technology roadmap to cover more applications in due course.

Our NIR sensors’ overall performance is far ahead of those of our peers. We currently can offer low noise HD and 5.5 megapixel NIR sensors with superior quantum efficiency in NIR band while operating at excellent power consumption.

With Emza’s machine-vision algorithms, we can transform AoS sensor from a pure image capturing component to an information analytics device that can be easily integrated into smart home and security applications, as well as smartphone, AR/VR, AI and IoT devices.

We are seeing heavyweight companies allocating major R&D resources and budgets in their new push for AR goggle devices. Having invested in related technologies for over 15 years, we believe our LCOS is the technology of choice with little competition. Our list of customers continues to expand and it now covers many of the world’s biggest tech names.

In addition to AR application, we are pleased to report that we are making great progress in developing high-end head-up-display for automotive applications. This represents a significant long-term growth opportunity for us. We will report business development in this territory in due course.

Note: The bold blue and underlined are my own emphasis

Above all else, notice the 2nd paragraph above that ended in “Thanks to our absolute technology leadership.”  Absolute is not a word you use lightly.

Now there you’ve it, it’s much easier for me to hold Himax for the long haul when they’ve absolute technology leadership in 3D scanning.

I got back into $BIOC this week. I like what this company does which is liquid biopsy. Unfortunately, because liquid biopsy is so new and revolutionary, the company has to spend a lot of time and money providing proof of concept to the medical community so that doctors can learn to trust the result derived from the liquid biopsy tests.  During this phase, the company burned cash like party goers burned marshmallow by the camp fire. Before you knew it, all the marshmallows were gone.  Unfortunately again, I was one of those earlier investors who got blinded by the beauty of the concept that the horrendous numbers were overlooked. The dilution just kept coming like it was a welcome raining season.  I had no choice but to cut the ugly losses when price broke $3 support ($1 pre-reverse split).  Good thing I did ’cause the company did more dilution afterward.  Nevertheless, with the last dilution the company now has $14 million dollars at the bank per their 1st Quarter 10Q.

So, why is this year any different from the prior years of Biocept existence?

Recent positive developments presented by the following updates and articles below lead me to believe that Biocept is gaining momentum and we may be seeing a bottom here.

  1. Biocept Awarded U.S. Patent with Broad Claims for Antibody Capture of Targets of Interest on Any Solid Surface Including CTCs and Other Materials Shed by Solid Tumors into Blood
  2. Biocept’s Target Selector Platform Featured in Three Clinical Abstracts at the 2017 American Society of Clinical Oncology Annual Meeting Where Company Plans to Launch New Marketing Campaign
    1. Excerpt from article:
      1. “In a large percentage of metastatic NSCLC patients, the patient’s mutational status from tissue is not available at the time key treatment decisions need to be made. This means that a significant number of these patients will not get the benefit of being qualified for target therapies,” said Giuseppe Giaccone, M.D., Ph.D., Associate Director for Clinical Research, Lombardi Comprehensive Cancer Center, Georgetown University. “Biocept’s liquid biopsy tests offer a non-invasive method that can complement tissue biopsy to help qualify more patients for targeted therapy, which has potential to improve treatment outcomes.
  3. The Addario Lung Cancer Medical Institute and Biocept Announce Collaboration and Initiation of Landmark ALCMI-009 Liquid Biopsy Clinical Trial in Lung Cancer
    1. Excerpt from article:
      1. In this large-scale study, which plans to enroll 400 patients, Biocept’s Target Selector™ assay platform will be used to detect and assess cancer biomarkers found in both circulating tumor cells (CTCs) and circulating tumor DNA (ctDNA) from the blood of patients with lung cancer.
      2. “We are pleased to join forces with major research institutions and cutting-edge molecular diagnostics companies such as Biocept to conduct a large-scale trial evaluating the use of liquid biopsy to detect and monitor key lung cancer biomarkers,” said Steven Young, ALCMI’s president & COO. Bonnie Addario, lung cancer survivor and the founder of both the Bonnie J. Addario Lung Cancer Foundation and ALCMI, added, “The collaborative research across these academic and community institutions will be transformative and will certainly benefit lung cancer patients.”
  4. Biocept Announces Collaboration with the OHSU Knight Cancer Institute to Increase Clinical Adoption of Liquid Biopsy Testing and to Co-Develop Additional Assay Platform Capabilities
  5. Below are excerpts from recent earnings call transcript:
    1. Importantly, world-class physicians at the Knight Cancer Center selected Biocept’s platform technology due to a highly sensitive and low cost solutions to perform liquid biopsy. We announced a collaboration with Catalyst Pharmaceuticals to provide liquid biopsy testing to patients in Catalyst Phase III clinical trial. This trial is evaluating the drug Firdapse in patients with Lambert Eaton Myasthenic Syndrome or LEMS.
    2. We now own 19 issued patents for a platform technology, with several patent applications pending around the world.
    3. We were also selected by the National Association of Blue Cross and Blue Shield through a rigorous request for proposal or RFP process.
    4. I’m pleased to announce that we’ve entered into a laboratory service agreement with a national group of cancer treatment centers to provide our Target Selector liquid biopsy services within a multi hospital network.
    5. Our broader commercial footprint is important as we head into major medical meetings this year such as ASCO or the American Society of Clinical Oncology meeting in June. We are preparing for a strong presence at this important cancer meeting and we have three scientific abstracts accepted for this conference.

There are a lot more updates from the earnings call transcript that included the “seven key initiatives that we are focused on delivering as we move throughout the year”  which will continue to gain traction for Biocept’s liquid biopsy platform.

The fact that Biocept’s Target Selector™ assay platform are being selected to use in multiple clinical trials is sign of acceptance that liquid biopsy is here to stay.  Furthermore, the oncology centers, from the articles mentioned above, are beginning to combine tissue biopsy with recurring liquid biopsy tests to monitor patients for specialized treatments.  In other words, liquid biopsy is here to stay and Biocept is one of the earliest pioneer in its commercial use. Once Biocept’s reputation and technologies are sealed, it may become the “go-to” place for liquid biopsy testings.

There probably are still doubters out there wondering if the $14 million is going to last.  But at this moment, I believe the coming ASCO meeting in June will be the catalyst for price to go higher.

BIOC_weekly

Despite a red weekly bar, it’s still a bar with a higher high and a higher low.  I expect to see the downtrend line broken as we head into the ASCO conference in June.

There is still not much movement in $IBIO while we are waiting for news on new development.  Meanwhile, the latest video update (dated April 2017) from Dr. Carol A. Feghali-Bostwick is quite encouraging.  Again, from the video below, Dr. Carol A. Feghali-Bostwick mentioned about how cost effective is in using plant-based peptide production as well as her discussion with FDA which suggested that they combined PhaseI&II together.  In other words, when approved by FDA once iBio filed their NDA, their first human trial will have immediate result on IBIO-CFB03 efficacy.

From the link below, click on the first video presented by Dr. Carol A. Feghali-Bostwick.

Go to 41 minute on the video if you want to skip directly to discussion on how IBIO-CFB03 worked on human skin, the significant cost reduction of using plant-based production (this is a very important issue ’cause the significant lower cost opens the door for insurance companies to approve the treatment), and her discussion with FDA.

http://www.sclerodermavideo.com/mobile/vidsmobi1.htm

Due to minor drawdown from $AMRN since I added back at higher price than closing price on Friday, my port gave back a bit for the week.

Current positions:

Main port (no margin): HIMX  IBIO  AMRN  BIOC  (up 0% YTD; while I’ve no gain so far, I believe the 2nd half of 2017 will tell a whole different story.)

Trading port (with margin): MENXF IBIO HIMX

My 2 cents

From my camera:

001



Categories: Daily trading Journal, trading journal

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