Simcere Pharmaceutical Group (SCR)

Company

"Simcere Pharmaceutical Group is a leading manufacturer and supplier of branded generic and innovative pharmaceuticals in China. In recent years, Simcere has been focusing its strategy on the development of innovative pharmaceuticals and first-to-market generics, and has introduced an innovative anti-cancer medication Endu, a first-to-market medication Sinofuan, and first-to-market generics such as Bicun and Anxin. Simcere manufactures and sells antibiotics, anti-cancer medication and stroke management medication. Simcere concentrates its research and development efforts on the treatment of diseases with high incidence and/or mortality rates and for which there is a clear demand for more effective pharmacotherapy such as cancer, strokes, orthopaedics and infectious diseases." (company website)

scr(4-1)
SCR 4-month chart
scr(4-1)_1yr
SCR 1-year chart

Buy

After reporting disappointing earnings in mid November, SCR's stock has rallied nicely. Go figure. Today there was a raft of bad news about rabies vaccine produced by one of its subsidiaries, and the price soared on three times normal volume. Go figure.

  • Percentage price oscillator (PPO) — diverging above the signal line
  • Volume — stabilizing again after a long decline in volume

MarketEdge does not follow SCR.

Sell

gain Bottom line
14%

With a very tidy profit close at hand, I put a tight stop on SCR to preserve the gains, and in early trading today the stop was triggered. SCR has been surging for about a month, and it was beginning to feel like I was tempting fate to try to hold out for even more profit.

scr(4-1)_pf Double-top breakout on the point and figure chart

SCR made a double-top breakout on the P&F chart this week, also a bullish sign. Nevertheless, I do get uneasy when a stock may be moving too far too fast.