Monthly Archives: March 2009

Flash Alert – 3.30.09 – Arena’s Lorcaserin Works; Stock Down Anyway Arena Pharmaceuticals (ARNA) announced their Phase III lorcaserin obesity drugs this morning, and the news was excellent, although not perfect. Importantly, the drug was well-tolerated and showed little impact on heart valve function. Management said that if the second Phase III trial results due in September are similar, lorcaserin will easily meet the FDA safety standard. Equally important, the drug worked, achieving high statistical significance over the placebo on every primary endpoint. The three endpoints in order of importance were the proportion of patients achieving 5% or greater weight...

Read More »

Heads Up On the Dollar On Wednesday The U.N. Commission of Experts on International Financial Reform, a specialist advisory committee that includes representatives from the U.S. government, will advise tomorrow that the world should dump the U.S. Dollar as the world’s reserve currency. They will suggest either an international currency unit based on several countries’ currencies, including the dollar (their preferred alternative), or a currency based on the Special Drawing Rights issued by the International Monetary Fund. Their stated reason will be that having the dollar as THE reserve currency unfairly burdens American policymakers at a time they are trying...

Read More »

Rally Still On Track, Big Test At 850 Coming Up Today’s explosive upswing – 54.5 points or 7.1% on the S&P 500, and about 500 points on the Dow – comes as no surprise. The 850 level on the S&P is one of the strongest energy levels under 1062, and is a very strong attractor/repeller level. That means stocks will be attracted up to it as a resistance level, or if the S&P can climb above it, back down to it as a support level for retests. However, it also means it acts as a repeller as stocks get close,...

Read More »

Two Ways To Speculate On Arena Pharmaceuticals Phase III Results I’m not an advocate of short-term trading for serious investors, but sometimes a situation comes along that is just irresistible. At the end of this month Arena Pharmaceuticals (ARNA) will reveal top-line data from the first of two pivotal Phase III trials of its weight-loss drug, lorcaserin. This is essentially phen-fen reformulated to avoid the negative side-effects that combination drug had on heart valves. Phen-fen was very effective for losing weight, but the unexpected side effects got it pulled from the market. Lorcaserin targets the exact same, well-validated weight-loss receptor....

Read More »

QuickLogic (QUIK) was up 9 cents yesterday and another 5 cents this morning, or 18% from Friday’s close, and I think this move is for real. The stock bottomed at 61 cents intraday a week ago Monday on low volume, but then word started to go around that QuickLogic blew ‘em away at the Mobile World Congress show in mid-February in Barcelona. What usually happens at these shows is the attending engineers and marketers go back to their respective companies and tell everyone else what needs to be pursued. Product data sheets are ordered, airplane reservations made...

Read More »

Rally in Great Shape So Far With the market up about 11% from Tuesday through Thursday, which used to considered a decent return for a year, it was reasonable to expect stocks to back off on Friday. And so they did, until near the end of the day it became obvious that too many traders were short stocks, and they had to buy them back to get to a neutral position (“flat”) for the weekend. That gave us four straight up days for the first time in over a month, and the best weekly performance since November. The professional reaction...

Read More »

Step 1 of Rally Over, On To Step 2 The rally started Friday almost exactly on the 664 energy level that I’ve been talking about. Fractal analysis is remarkably accurate at finding these energy levels long in advance. After a strong intraday rally Friday, the S&P 500 rested on Monday, exploded up on Tuesday, and rested again today. It is very common after a big daily move like Tuesday’s to have a day where prices go back down a little, then go back up a little, and end up almost unchanged. I would rather have seen a straight run to...

Read More »

The S&P 500 was stretched down about as far as it can get by the close on Tuesday, so this morning’s bounce was both inevitable and no big deal. I did find an old energy level at 664, and the best resolution right now would be a plunge to 664 followed by a slingshot back up to 750. That would show some energy available to move through 750 and up to 840. But there isn’t much in the recent chart to make this the highest probability outcome. A decisive move up through 710 is the other way to get to...

Read More »