DexCom (DXCM)

Company

"DexCom, Inc. is a leader in continuous glucose sensing technologies, and focuses 100% on these technologies. Founded in 1999, DexCom's roots stem from the pioneering 1967 research on implanted glucose sensors at the University of Wisconsin. DexCom started with a focus on creating an implantable Sensor that the body would not reject and that would perform for a long period of time." (company website)

dxcm(3-1)
DXCM 4-month chart
dxcm(3-1)_1yr
DXCM 1-year chart

Buy

DexCom bottomed out in November 2008 and has been climbing steadily in a channel since then. Although the August earnings missed Expectations by 2¢ it had no effect on the general trend. Right now, support ($8.19) and resistance ($8.28) are very close together, and the Bolllinger bands have narrowed. What should happen now is a break — I'm counting on it being a break to the upside. The volume of up-days is much higher than the volume of down-days, indicating more buying than selling.

  • Percentage price oscillator (PPO) — running below the signal line and parallel to it; either convergence or divergence should indicate the direction of a break
  • Volume — under accumulation

Based on technical analysis, MarketEdge calls DXCM a "strong buy" in a "strong upward trend."

Sell

gain Bottom line
-8%

The stop-loss order kicked in this morning and took me out of my position in DXCM.

When Bollinger bands narrow, as they did in the case of DXCM, it usually presages a price move, a break one way or the other. I bet on it being to the upside; I was wrong. With the market taking its customary October dive, DXCM never regained momentum to take it up.