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Biotech / Medical : Sepracor-Looks very promising -- Ignore unavailable to you. Want to Upgrade?

To: ok who wrote (1110)	9/1/1998 9:14:00 PM
From: billy d	Read Replies (1) \| Respond to of 10280

IMO I think alot of us are missing the picture in the price decline. I have been and still are a big believer in SEPR and regardless of wether or not there are fundamental changes with this company when the market decides to lower the PE's (although SEPR doesn't have one yet) on the market it will generally take everything with it ala SEPR. One could say that with rates still very low that the PE's shouldn't change but until the market stabilizes and figures out just where it should be I think a big move up in the near future will be a tough sell. I also think that with this massive volume, be it a fluke or not, we will have to build a base before we move much higher. To me it is a negative indicator to move down so sharply with such huge volume. As I said in my last few posts, it is hard to buck such a tough market trend and even with todays move up, I'm not convinced. I have been shorting alot of stocks and will continue to do so, especially if we get towards 8000 again.

To: ok who wrote (1110)	9/2/1998 1:31:00 AM
From: David Howe	Respond to of 10280

Here's several takes on today's trading and high volume. I noticed that SEPR fell to 42 1/4 on around 300,000 shares. The rise from 42 1/4 to 45 was on around 2,600,000 shares. You could call that high volume on an up move instead of high volume on a down move. Look even closer and you will see that there were about 2,200,000 shares traded on the way from 42 1/4 to 47 +. It was on only 400,000 shares that SEPR traded from 47 to 45. Look at it how you like, IMO we saw strong buying at bargain prices. Another explanation is that the market has fallen considerably. There were stocks cut in half over the last month. Bargains everywhere (at least relative to recent prices). In order to buy these bargains people, funds, traders, had to raise cash. They sold one of their big winners. Even though SEPR has a great future, others decided that there were even better bargains out there. As the market recovers, SEPR will look even more attractive and the price will rise. The final probable reason for the high volume was the large number of biotech investors that were forced to sell some stock to cover margin calls. Not entirely from the fall in SEPR share prices, but mostly from the dramatic fall in other biotechs and stocks. Anyone on margin got hurt bad. The average stock is down 50% from it's 52 week high. The Dow and Nasdaq are market cap weighted and hide the true depth of this correction. Big traders, funds, etc. knew that there would be a lot of selling today and they stepped out of the way and let it fall. Of course the fall caused more fear and more selling. Once SEPR was at a price they could not refuse, they stepped in. There were some huge buys coming in in the 43 through 45 range. Continued volatility is possible. If the market falls again, so will SEPR. Long term SEPR will outperform the market by a considerable margin. My take on the market is that a year from now the Dow could still be at 7800 or so, but, SEPR will be at around $80. Dave

To: ok who wrote (1110)	9/2/1998 6:25:00 PM
From: M. Ramle	Read Replies (4) \| Respond to of 10280

Oscar: Sorry for the delay in responding to your question regarding yesterday's drop on a very high volume. I was talking to a friend of mine who worked on the NYSE Trading Floor to get his opinion on such a move. His response was as follows: "When there is a large-size order on the buy side (especially if that buyer is a good client of the company clearing the purchase), the MM would normally attempt to take the price of the stock down drastically in the absence of other good-size orders on the buy side. By doing so, he will try to pressure the weak hands to panic and sell and possible trigger some sell-stops as well, thus accumulating as many shares at the lower prices to satisfy the large-size buy order (remember that the MM is the only one who has the information on the buy/sell-stops as well as all limit orders). Another scenario that has been witnessed rather lately which involves more risk on the buyer's side is by manipulation, i.e. if a buyer wants to buy (let's say 200K shares of a stock) without moving the price much higher until his order is filled, will try to sell short several increments of 5K during the last hour of trading in order to create some selling pressure towards the closing and possibly trigger some sell-stops as well as liquidation by the day-traders, until the stock reaches his price, at which time, he will step in to buy larger blocks (partialy to close his short position at a slight profit), and establish a long position." Mind you that both scenarios are very tricky and could be very costly if they are not executed properly. Having said that, I personally believe that this is exactly what happened yesterday towards the closing. Apparently, a large buyer came in by mid-day yesterday and started accumulating SEPR around the $43 price range until the price began to recover very rapidly to reach almost $47 3/8, at which time, that buyer slowed his buying down until the final closing minute when he came in with 2x100K shares buy orders right at the close." I have also been noticing recently that more buyers in SEPR are stepping in once again on the buy side by placing their large-size orders right at the closing so that they do not attract too much attention and move the price too much. Anyway, today's action was rather impressive on good volume, although I would have liked to see SEPR close above the 50-DMA at ~$51-52. If you look at the daily chart of today's action, we traded lower right at the opening to test the 200-DMA once again at around the $43-44 area, and held up very well (yesterday we traded as low as $42 1/4). It might be a little premature for me to call this a double-bottom testing of the 200-DMA, but I was willing to take my chances to step in today and add to my position around the $46 area. I hope the bears are sawing their fur coats very well because I am going to send them to the North Pole very soon for a long long long hypernation COMA. GOOD LUCK TO ALL. Mazen