Momenta Pharmaceuticals, Inc. (MNTA)

[flatlander_60048]

I agree. Your previous post left a caveat that the downtrend needed to be confirmed and that the potential reversal(upturn)at the beginning of the week needed to be confirmed by a day of follow through. But that is precisely my point we have entered a totally news driven environment where any news out of Europe has the potential to cause a 180 deg market direction change.

I just think in the current market the cycles have broken down where you can't project a decent trend line for any duration to allow worthwhile TA. I know you will term this as volatility with discernible trends. However, IMO the usefulness of TA breaks down if you are looking for corroboration on too short of a cycle.

It is interesting to note that the MNTA correlation to the news cycle and the rest of the market appears to be diverging. Since MNTA presently sells to the US market and will do so for the foreseeable future it is pretty insulated from the European headwinds. For this reason it provides a little bit of a hedge from my NVS exposure.

I'm long MNTA for a different long term reason. The demographic trend and economics strongly favors companies that can efficiently bring cost effective bio-generics to market. I think we will see this as a strong trend as austerity programs come to the shores of the US. That said, we need to see confirmation of the m-enox promise in the next few months. If this confirmation comes either in the form m-copax ANDA approval or FOB alliances with a major pharma then MNTA should be awarded a substantially higher PE multiple on top of share price increases due to upward earnings revision.

That's my dream, we'll see how it plays out. In the mean time I have done well with MNTA by trading around my core position using covered calls.

Good Luck

FL





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