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Why I Just Shorted The Hype/Manipulation That Is Arena Pharmaceuticals, Inc. (ARNA)

Posted by Timothy Sykes on Wed 18th of Feb, 2009 05:38:59 PM

As I wrote in my premarket watchlist for TIMalert subscribers today, ARNA was a potential short because it’s a hype-filled piece of crap biotech (yup, I said it, look at their fundamentals, $2 mil in quarterly revenue, $55mil in quarterly losses!?!?!?…horrendous, only thing that’s saved them this long is that they aren’t a leverage-loving financial)…

I watched the stock all day, narrowly missing my morning short when it took out support at $6.25–not that it matters for my premium subscribers as I discuss in my PennyStocking Part Deux DVD, morning panics are difficult, if not impossible, to send out alerts on because they happen too fast–that’s why I greatly prefer another pattern I cover over and over (see this full independent review HERE I just found last night), the afternoon fade…

…and once ARNA did its 15%+ morning drop, go sideways for several hours right around $6–not surprisingly, this was support from a few days ago…which it held that time before short squeezing to $7+–so I figured if it took out that key support, second time’s the charm…long story short I shorted 2000 at $5.98 late this afternoon and was very pleased by the obvious chart top that has now developed:

hype1 Why I Just Shorted The Hype/Manipulation That Is Arena Pharmaceuticals, Inc. (ARNA)

top1 Why I Just Shorted The Hype/Manipulation That Is Arena Pharmaceuticals, Inc. (ARNA)

After all, the reason for this carcass’ surge was the CEO running his big fat sugarcoated/cheerleading mouth on CNBC about how great their pill for fat people was and how confident he is that it’ll pass late stage trials, (the reporter asked him why he’s so confident, he pointed to successful phase 2 trials aka every phase 3 drug trial has passed phase 2, it DOES NOT MEAN THEY WILL PASS PHASE 3…or else every drug passing phase 2 would somehow skip past phase 3 to acceptance), the results of which will be announced in late March….that got all the shorts scared and lots of dumb CNBC viewers down 40-50% got to thinking this is their last shot at being middle-class again.

On top of that, the last time I shorted it at $6.15, Agora Financial came out and promoted the hell out of this, sucking in their dumb-as-Vick subscribers into believing this was the stock that could make them rich…FYI Agora owns 500+ internet domains, they have subscribers coming out their ears…add together a potentially great-but-longshot (as evidenced by the horrific long-term stock chart that no amount of CNBC/Agora/CEO cheerleading can hide)story + Agora saps and CNBC chumps and you got a powder keg

Well, the hype can only last for so long and today’s UBS downgrade–who woulda thought a friggin ANALyst would be the reasonable one for once–really reminded people as to the potential risk of this carcass:

“Although we remain positive on the expected outcome of the Bloom and Blossom (lorcaserin) trials, until final data is available the potential for negative efficacy and safety results cannot be eliminated,” he said in a note to investors.

Also, the Food and Drug Administration has been taking a more conservative approach to approving new treatments, Elliott added. Results from the Bloom study are expected in March.

Considering the beautiful price action today, the overall chart pattern and most importantly, the axis-of-evil-TV-spam-CEO-typical-cheerleading hype that caused this runup, I’d like to cover tomorrow or the next day between $5 and $5.50 for profits of $2,000 to $1,000

You gotta love the manipulation game and recognizing when a stock has been manipulated higher, not illegally, just by the natural self-interests of the parties involved. That’s Wall Street.

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  • Matt
    Hey Tim, I'm a junior in high school, Dallastown Pennsylvania, and have recently been chatting with Mike Swords. He said that your web site is great and I have to agree! I hope to learn as much as I can about micro-cap trading and build my own portfolio. I like having an option to take your alerts, but I hope to learn enough so that I can forecast my personal alerts haha. I would love to hear move from you, through my e-mail address if you are available. Thanks so much!
    -Matt
  • younggunz
    nothing i said i would consider being a dick. not that you really care either but you're age estimate is low by a decade. It is you that I feel needs to be giventhe explaining since you don't seem to grasp that concept. No one ever said all biotechs are sketchy but the ones that do sketchy press releases and hype games are unnaturally effectinng their stocks prices.

    Even if they aren't doing any of it themselves and the company is getting message board hype it still creates unnatural price movement that looks sketchy and ripe for shorting when the buzz dies.
  • I'm not bitter... I short biotech stocks just the same as any other... that doesn't make them "sketchy" and "fraudulent". YoungGunz, yes they go to the public for money... like I said, I wish these weren't public companies, since this type of work is different than building something of an engineering nature because those kinds of projects don't involve the unknown and unbelievably complex systems... but that involves financing from another source such as the public sector... if you weren't such a dick and 15 years old I would take the time to explain it
  • younggunz
    Quit holding a torch for biotechs, yeah many are trying to develop drugs to save lives That doesn't change the fact that the the business model of these publicly traded companies that develop these drugs are riding on their drug being approved. They go public to raise more money. they wouldn't go public if they didn't need the money.
  • its crap based on its longterm stock chart and popular opinion that their drug isnt going anywhere fast....what makes the stock surge was a crap newsletetr mention and CNBC appearance. learn how the game works, profit from it and u wont be so bitter
  • Biotechs burn through a lot of capital because it is expensive to do science. That doesn't make them "hype filled" and "crap". Personally I wouldn't mind if biotechs never were publically traded companies and all research was done at academic institutions, but that is not the case. There is a difference in undertaking something that is important but a longshot versus wasting money on something frivolous. However you will never ever understand that. Perhaps you think that all biomedical research is frivolous; however, given your sterling personality, I would fully expect you to talk shit all the way until a cure for some disease or condition that you had came along, then you would line up at the trough like every other hypocritical ignorant fuck that doesn't know what he is talking about.

    Congrats on almost breaking even for the year, going on March.
  • and yes to those emailing me, u can get my realtime trade alerts like this one at http://www.timalerts.com sign up is right on the upper right hand corner
  • all it takes ia a great setup like this and a typically pathetic exectuino by me and most importantly thousands in subscriber gains to quiet my dumb-as-Vick haters
  • younggunz
    You want more members but I don't think the members want more members :)~
  • lmsmith
    Good trade Tim--- I got sick of seeing the sea of red-
  • My TIMalert subscribers & i just banked 10%+ overnight, we're now accepting new members:

    http://www.timalerts.com
  • younggunz
    I like when I anger someone so much you can see it in their typos. I didn't say he had a hedge fun buddy, you did. I know what you meant to write but that is not what you wrote. Therefore you have been dubbed Shooter McGavin. Something tells me Tim isn't really hurting if the trading 'community' doesn't except him. Anyone that knows enough about it knows its not some Billy badass profession.

    Sure I would love to make millions and only a small percentage are good enough to do so. It's kinda like sports. Yeah I like playing baseball but no I am not good enough to play in the majors. I do settle for playing softball in the summer because its entertaining and an excuse to basically enjoy being outside, have a picnic with friends, and drink. Yeah I trade stocks but I don't consider myself a trader.

    Having only started actual trading and not buying and holding within the last year I do believe that Tim offers a very good gateway into the trading world. He's leaps and bounds above anything else out there for people who have always wanted to get into it but don't know how. There have been several people that have been trading for a long time and really haven't found direction or developed a successful strategy of their own that have been helped by listening to what has worked for Tim. There are successful traders that have adopted parts of Tim's strategy as well that have been helped.

    So if you think Tim is such crap what would you suggest to everyone here is a better alternative to learning to become successful at trading? Keep in mind there are many people that simply don't have buckets of money to work with otherwise there really wouldn't be a reason for them to try it out.
  • tapout_mma
    Wow TIM, this deusche bag is really jealous of you. Just asked a few people here in Chicago and they love ya.
  • ALL IDIOT PLEASE READ
    Fist off Shoot McGavin, learn your trading facts, mornon. Degenerate, ingrate, etc. All wonderful Timmyisms. Retards ahoy!
    Borsellino doesn't have a fund you idiots! READ the posts. The point is he never NEEDED one, just like it would cost him way more $ trying to keep some shit for brains PENNY stock site, tham he would make. You guys need to get a life and stop rimming your favorite blogger as if he respects you. As if. Also, Borsellino makes millions a year from trading, the last thing he needs is idiots like you emailing and taking up his time. Part time traders don't pretend to be something they are not, so go look up what being a trader is. You fools make me crack up, love seeing your heated expressions about penny crap and Timmy two time. Just ask anyone in Chicago who Tim Sykes is and they will laugh at you. Then ask anyone in NYC who he is and they will pretend they don't know you. Mistakenly honoring traders in "trader monthly" magazine is ezxactly what happened to Tim, yet he was so butt hurt that he couldn't accept that traders do not ACCEPT HIM! So do some research and trade your $1,000 accounts away....just don't go around calling youself traders. ESPECIALLY you Sykes. 96% profit from ads and alerts. It speaks for itself. Traders trade, attention whores whore out. Have at it retards...
  • younggunz
    Sounds like Joey Borsellino is missing out on a lot of residual income :-0...Kinda funny you think his hedge fund is crap if he's the #1 trader in the S&P pit...Good one shooter McGavin. Do you eat pieces of shit like Tim for breakfast too?

    You must not have read any of the times Tim said he is a part time trader. He found himself a niche that has worked for him consistently but its downside is that it is not scalable. He tried to use it with his hedge fund and had difficulties and admitted to straying from his strategy.

    Yeah the majority of traders keep to themselves but there are going to be some that are willing to do so. I find it funny that people take the time to give Tim shit for what he's doing when there is enormous amounts of utter scams and frauds, spewing their snake-oil leading people along and developing their sites to trick people into giving them money and give nothing in return.
  • u narrowminded finance freaks just dont get it, the definition of trader doesnt have to be one who cant blog & teach others...the days of counting my $, being weird like a typical trader and having no lfie are over...we're going mainstream now, degenerates please feel free to get off the bus, u stink up the place
  • Tim is NOT a trader
    BTW retard.... Stop constantly comparing yourself to the "other gurus" and "other bloggers" and other "ENTIRE GURU INDUSTRY"....You DONT GET IT. Those people are no where near being traders, so why the FUC* would I compare you to them, and come to the conclusion that you are a trader. Plain and simple, you wouldn't stand a chance in the pits at the CME, or even as a screen local trading emini's. That is who you should compare yourself to if you claim to be a trader. PLENTY of them on Covestor, but oh yea, "I dont trade real stocks, or futures, or currencies, cause I am a pussy and would loose all my money in the zero sum transaction market." Writing books, articles, selling snake oil, marketing based alerts....Thats your business. Traders don't do any of that crap...They trade, take notes, analyze, and repeat. Have some loyalty, honestly, and moral judgment for once, and just understand you are not a trader. Have you seen Joey Borsellino (#1 trader in the S&P 500 pit) with a website, writing a book about his crap hedge fund, or god-help-him, creating a trading alerts service? I'm sure you dont even know who he is, which again proves you are not a trader. Only traders know who he is, and understand why he is 'invisible'. You should take the advice....
  • LOL, my track record would disprove your theory...as for marketing, go talk to your ENTIRE trading guru industry, why arent they on covestor? wht dont they blog openly, why dont their products have testimonials nearly every day like i do? ingrates like u make me sick, the only good news being is that people like yourself lacking in intelligence are poorer than ever
  • Tim is not a trader
    Tim, you are not a trader. You are a marketer.

    Why THE FUC* would you be "speaking" at a trader expo. I am literally speechless. You are a disgrace to the art of trading. Read Jason Alan Jankovsky's book from Wiley, The Art of The Trade (what I learned and lost trading the Chicago Futures Market).....people like you are what made that such a fantastic book.
  • Tim check out Connected Corruption: http://scopelabs.net/shame.html
  • twitterfkr
    "...morning panics are difficult, if not impossible, to send out alerts on because they happen too fast..."

    paid subscribers to invite only twitter or tell macbeth and lindzon to get on the invite only stocktwits. plenty of your timfkrs would do it. or i'm talking out my ass probably the latter
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