i know some don't ascribe much credence to technical analysis, particularly for a development stage biotech, but my read of the charts suggest that the stock is approaching an inflection point in the not too distant future (perhaps coinciding with certain events that drive fundamentals) that may be decisive in the battle between the bulls & bears, at least over the intermediate term.
the uptrend begun roughly this time last year got ahead of itself with jav going up too far too fast - not that surprising for a development stage biotech. it has obviously since corrected, in fact it overcorrected in mid august, thanks in part to the subprime credit crunch.
what is interesting is that just before that significant uptrend (from a low of $2.66 in oct/06 and hitting $7.60 in march - almost a 3 bagger), the stock sold off about 30% from mid august to the october low).
will history repeat? well, imo the odds aren't bad, especially considering they now have UK marketing approval for dyloject in the bag.
the chart tells me that the fight between the bulls & bears is heading for a potentially decisive battle in the near future - volume has not surprisingly picked up since UK approval, and while the price hasn't gone in the expected direction, there is little risk, imo that the stock will close below $4.45-$4.50 which is an area of solid support based on the trend line from the oct/06 low thru the aug/07 lows and the line of support line extending from the Jan/06 high thru the Feb/07 lows and Oct/07 lows.
on the bearish side, the downtrend line starting from the may/07 high thru the early June high and extending to the Oct/07 pre-approval high is headed for collision with the aforementioned uptrend line over the next month or so - and i suspect that this will prove to be a decisive "battle" for the near & intermediate term. I expect the bulls will prevail and jav to break out to the upside, perhaps sharply thanks to the almost 3M exposed shorts, where the previous highs in the mid $7 range are tested & eventually taken out.
of course, any significant market moving news could (& probably would) materially change the above scenario, however, barring that, i think the odds for the start of a decent 50 to 75% move to the upside over the next 6 to 8 weeks are pretty darn good, imo.
the current price is very attractive on a risk/reward basis, imo -
is it any wonder why there has been an influx to a formerly sleepy anonymous stock message board of a company that has just received long awaited drug approval - filling it with a lot of negative posts or just clutter? couldn't possibly be shorts seeing the same writing on the wall & looking to minimize the damage or even longs looking to talk the stock down & pick up some more cheapies?
technicals tell me the answer is quite plausibly yes.
