ViroPharma (VPHM)

Company

"ViroPharma Incorporated is a biopharmaceutical company dedicated to the development and commercialization of products that address serious diseases treated by physician specialists and in hospital settings. ViroPharma commercializes Vancocin(R), approved for oral administration for treatment of antibiotic-associated pseudomembranous colitis caused by Clostridium difficile and enterocolitis caused by Staphylococcus aureus, including methicillin-resistant strains. ViroPharma commercializes Cinryze(TM) (C1 esterase inhibitor (human)) for routine prophylaxis against angioedema attacks in adolescent and adult patients with hereditary angioedema (HAE), also known as C1 inhibitor deficiency.... ViroPharma currently focuses its drug development activities in diseases including cytomegalovirus (CMV), HAE and C. difficile." (company website)

vphm(3-1)
VPHM 4-month chart
vphm(3-1)_1yr
VPHM 1-year chart

Buy

In late July ViroPharm delieved an earnings Surprise to the market, beating Expectations by 2¢. It is now making a third run at resistance since that time. The Bollinger bands have narrowed dramatically, and I am expectiing a break above resistance.

  • Percentage price oscillator (PPO) — just below the signal line, but converging sharply
  • Volume — heavily traded and, except for profit-taking after peaks, high-volume days have been up-days.

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

Sell

gain Bottom line
3%

My stop-loss order was triggered this morning when the asking price fell to $8.60, bumping me out of the position with a small profit.

I'm always torn when this happens. On the one hand, I look at the recent peak at $9 and think, I could have had 60¢ profit instead of 30¢. And when I see a bullish sign like the 50-day moving average crossing above the 200-day MA, I can't help but wonder if I got dumped out too soon. And on the other hand, I see that momentum stalled a couple of days ago (the PPO line stopped diverging from the signal line and is now running parallel to it) and think, Probably good that I got out, it's been a while since the price touched back to the 50-day, and I probably would have seen all profits dribble away.