Amarin Corp Plc (AMRN)

[FlyFishingStocks]

Bad news, good news, bad news, good news:
I’ve been back-testing exit strategies based on biotech stocks that gaped and ran on news. I’ve discovered some interesting common themes.
1. Bad news: Microcaps priced similar to AMRN, with negative earnings, similar dollar volumes and similar short interest, all suffered selloffs to their 52wk lows 1-2 months before binary events. So yes, AMRN with its vulnerable volume characteristics and lack of conviction in breaking out above its 200MA will likely follow the same pattern.
2. Good News: Each saw huge gaps on the news event. If a halt is in the cards, we should also see a colossal squeeze induced gap and run up to $17.00 before a pullback.
3. Bad News: Each retraced their initial post-news rallies by approximately 50%.
4. Good News: If the retrace was no further than 50%, a series of higher highs / lower highs ensued over several years compounding share prices.
e.g. JAZZ (Jazz Pharmaceuticals):
If a position was sold following the first violation of the 20MA (post breakout), it would have led to a profit of 209% (.55 to $8.38).
If the position were held through the retrace and only sold once the first lower high / lower low traced, it would have yielded a gain of 20,861% (.55 to $115.29)

Summary: In the end, we’re all going to look beat up like “Barry” in the Big Short, but we’ll be rich ;)