Star Performer for the Day - MDVN

Kind of strange to say that my star performer today is a low cap biotech company when I hold those other Chinese stocks. IBB was flat today, so it wasn't a sector driven rally. No news to speak of, but the volume was stellar at greater than 2x daily average. Shorts have been throwing their weight around on this stock for some time. The current short interest of 23% of float is starting to feel the heat with the recent 10% run and will continue to feed the push up as long as high volume stays with us.

For those of you that don't know much about this company, click on the link and educate yourself (I'm not going to waste valuable space here describing what I already know). http://www.medivation.net/pdf/MDVN_Factsheet.pdf

I am a technical guy with fundamental frosting. The fundamental story is intriguing, but as is the case with any biotech company, it takes time to develop. So then why in the hell am I focusing on this company when my initial lead in blog said that I would not focus on these long term stories? Because the goddamn price is trending - that's why. The perfect storm exists here: (1) trending stock, (2) high short interest, (3) breakout on high volume, (4) low cap, and (5) long term story.




The daily chart above shows the breakout move that began yesterday on high volume and was followed through with today on high volume. No doubt that this is something to pay attention to. The chart below clearly shows the breakout move for MDVN following the resting/ consolidation period from the move that began in September 2006.

I picked up my initial block (1/2 position) during the first leg and have waited several months for this second move. I added to it today with a 1/4 increase in shares. I will now site back and watch this second leg play out and consolidate. It will be after the third leg pops that I will add a final position. Obviously, the company cannot significantly dissapoint moving forward.