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Biotech / Medical : Hollis Eden Pharmaceuticals Inc. (HEPH) -- Ignore unavailable to you. Want to Upgrade?

To: Alan Lee who wrote (20)	2/19/1998 11:45:00 PM
From: Pullin-GS	Read Replies (2) \| Respond to of 138

>Would you care to do an analysis of this stock from the short side? Certainly. I'll analyze the stock from the TA side. I chose my short based on TA, and some fundamental observations (or lack of) as well. >While the quirkiness of this stock alone would seem to suggest a short position, there's so little information available that it seems a bit risky. Actually all the information I needed to make my trade was right in the charts. The lack of fundamental information only made it easier. And yes, it is a risky trade, as the majority of short positions are. Some TA for HEPH: First off, let me say the weekly trend is up, way up. This one fact looked at in and my itself would suggest to buy long....the trend is your friend. However, IMO we are currently in an overbought condition. Given that HEPH has been taking out new highs, one cannot use simple oscillators to determine possible trend reversals without getting burnt badly. HEPH has had several of these reversals since it's run from 6, and I expect many holders where shook into selling, or some poor short seller learned another lesson (I could be next. <G>). Anyway, looking at the chart, notice that HEPH took out 18.5 about 2 weeks ago, only to loose some momentum over a weeks period. HEPH then made another run for 18.5 or so and again lost momentum and failed to take it out these last few days. It would appear that HEPH may be in for a reversal, barring any fundamental changes in the stock. I got my trend reversal, now all I needed where some bullish daily chart indicators to place my short. I found many: First off, one of the less popular indications (one of my favorite) was that we closed BELOW our Volume 21 EMA today. Bearish. We pegged the upper envelope of the Bollinger Bands 2 days ago, only to fall back towards the 21EMA. One would have liked this resistance level to have been broken. The last time HEPH attempted the upper bollinger band, it tanked from 18 to 14 in 2 days. Today we had confirmation of a possible trend reversal with the continued price/volume decline. Bollinger marks support at 12.625. Resistance is at 20. Kinda-Bearish. MACD Histogram went negative off of a relativly high peak....this has only happened once in the stocks history and that was about 2 weeks ago where the stock attempted to take out it's high, but failed. Momentum was lost. Very Bearish. Smoothed Rate of Change (SRoC) diverged from price 3 days ago after a long uptrend with no divergences since the stock $7.75. This is a strong trend reversal indicator. The reversal was verified by yesterday's and today's action. Very Bearish. RSI turned downward today at 76. The chartists are watching this one closely. RSI has been very strong, but is starting to falter. RSI crossover at 70 will bring on the selling pressure from the technicians. Could be Bearish...but could be a hickup...watching closely. ADX is also below -DI and below +DI....but then this has been the case all along. No read...normally bearish, but can not apply it to this stock. Bostian's Accumulation Distribution had a bullish crossover on 2/13. Both plots are turned downward, but no indication of a bearish crossover yet. Bullish. Ultimate Oscillator...another one that has been giving false bearish readings all along on this stock. Only gave one bull read back at $7.5. No read. Even the Eastern chartists got a bearish reading (big time todays close) on HEPH. Today's Candlestick (an engulfing pattern) signified a possible bearish reversal. We had a large black candle today enclosing yesterday's white body. Today signified our first black candle since our reversal 2 weeks ago. Bearish. Stochastics. This stock is all over the place these past few days, hovering between 60-90 for the most part. We crossed into the 80s today. Bearish...but I get so many false reads with stochs that I did not consider stochs for my analysis...no read. I show alot of buying in (relative to the short trading life/volume of HEPH) occuring between $12.5 and $18.5, with the two heaviest volume days occurring at the highs. The stock declined from there. HEPH established a minimal amount of resistance at approximatly $17.5. Notice that $17.5 is what the stock closed at today...this confirms resistance IMO. But the resistance is light, and can be broken with not alot of effort. On the same note support is weaker at $14.5. Our next (stronger) level of support is $10.0. Long-term (a few weeks for me <G>)trend is up, with signs of loosing momentum. Short term trend is turning down. A few more down days, with more volume and we will have established a reversal. It will be a rush for the exits...to late to get a really good short. All of the above could be undone by one or two strong days. If $18.5 is taken out, it would be a continued uptrend to who knows where (no past history...new highs)...I will have been stopped out long ago. Good luck, and congrats on getting in on the ride up....I wish I where there to enjoy the fun. Regards, Paul