Dendreon Chart Now Trumps News (DNDN)
Dendreon Corp. (NASDAQ: DNDN) has turned out to be nothing short of a disaster since its huge post-FDA Approval for PROVENGE as a last line of defense for metastatic prostate cancer. The trick is great in that the “drug” uses the dendritic cells to make the body’s own immune system fight the cancer for the body. Last week’s news out of Medicare may have been the calling card for Dendreon’s now even more torn bull-bear war.
We highlighted the issues and the reality of what this really means for Dendreon over in a 24/7 Wall Street exclusive before the 3-day weekend. Here is the chart, followed by a review and analysis below:
Now for the “but”…. Sometimes the fundamentals just do not matter. Sometimes that chart takes over, and everything else just becomes a new technical reason for an entry or exit in a trade. This chart above from StockCharts.com tells it all…
The warning sign came in June when Dendreon broke under its 50-day moving average. That was a real tell, but unfortunately that also coincided with many other things. The biggest issue now is that Dendreon is in clear violation of its much longer and more implicating 200-day moving average. The good news is that this offers many longer-term investors the chance to get in. The bad news is that this also gives an implication that almost any and all rallies will be sold off unless it is an outright reversal of this new Medicare review policy.
While that 30-day public comment period is in effect, the chart is not a favorable one for Dendreon and its investors.
JON C. OGG
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