Some tactics for trading this fishy drug stock. (July 07, 2012)
AMRN ARNA
I’m Dan Fitzpatrick at StockMarketMentor.com on Saturday, July 7th. Look, I want to look at Amarin ( $AMRN Amarin Corporation plc (ADR) ) real quick here. On July 27th, they’re awaiting some approval from the FDA on AMR 101. I’m not going to tell you or give you the sense that I know anything about this stuff, I don’t. It has something to do with fish oil, that’s about it, but I know this; the stocks on a flat top right there, higher lows right there; now the stock is moving along the upper Bollinger Band. It’s quite choppy, maybe it kind of doesn’t seem that way right here, but if you bought the stock here, at $15.00, and then the next day it’s down at $14.00, you know you do the math on that, as far as you know percentage loss, you know it gets kind of sporty pretty quick .So keep that in mind, but as long as the stock is kind of meandering around the upper Bollinger Band, this is a stock that can move substantially higher; the short ratios about five, meaning it’s going to take about, if all the shorts just had to cover, based on average volume, it would take about five trading days in order to get all those, to get all those shorts covered. For a drug company like this that’s actually not a particularly high short ratio, but we do have a move higher. I think the stock can continue to move; I would just suggest keeping a trailing stop on the position, because this can prove me wrong at anytime. Also all you biotech heads out there, or you know drug experts, that type thing; don’t think that I know anything about these drugs, don’t think I know anything about the company, I don’t, just full disclosure here. When I see stuff like this it kind of reminds me of Arena ( $ARNA Arena Pharmaceuticals, Inc. ) which some members in Stock Market Mentor got a lot of this trade; I didn’t, I got some of it, but I was chicken; some of you guys aren’t and good for you, but I get to sleep better at night. Arena ( $ARNA Arena Pharmaceuticals, Inc. ) was a nice one. Amarin ( $AMRN Amarin Corporation plc (ADR) ) could turn out to be a similar type of situation, just watch how it trails along the upper Bollinger Band, that’s your tell on the stock. Okay, members get to the weekend update. We actually have quite a few stocks that we’re looking at, including one that fits into my IPO strategy that I think is going to do pretty well, so you can get over there now. Free Chart