Charts Suggest La Jolla Pharmaceuticals Will Fall 50%
Shares of La Jolla Pharmaceutical returned 50% in 2015, impressive considering the S&P was flat and the biotech index rose 11% during the same time period. But from a technical perspective, it doesn't look like shares of La Jolla will fare as well in 2016. Shares of LJPC are poised to fall up to 50% if this bearish head and shoulders pattern plays out.
The head and shoulders pattern has been six months in the making, and after shares fell more than 7% to start off the new year, they dangerously approached dual neckline and horizontal support in the $24 - $25 range. A decisive break below that support range would lead to a measured move price target of $10 - $11.
Disclosure: I have no position in LJPC, but may initiate a short position anytime in the future via put options.
Wow, all that insider direct buying from 12-13 to 38....what a huge mistake.
Wow indeed!
Thanks for the comment Deborah. To put that buying into perspective, it was by Tang, who is a billionaire. So he will survive!