I get emails from members and readers all the time about stocks they want me to look at and stocks they personally like (or hate).  Two of my best emailers are Jeff D. and Anat P.  One thing they have in common is:

Labopharm, Inc. (DDSS)

It seems that they are both investors (albeit unwillingly) when they would rather be traders.  What that means is that both of them are sitting on losing positions on a stock that really ticks them off. Why, they wonder, did the dang stock go DOWN when it had good news and FDA approvals?

I wonder the same thing.

Back on the 9th of February, I blogged DDSS for Investor Soup.  While I tried to figure out what happened then, I don’t have any better idea now than I did then.  At $1.82, I thought that traders should watch it in case it was bottoming out.   Well, it kept falling and is now “basing” in the $1.40 range.

Actually, I do have an idea why DDSS is stuck and won’t budge from this level.  It’s called

APATHY!

Nobody cares (except Anat, Jeff, me and maybe you).  I looked on Seekingalpha.com and found no recent articles.  I rely upon SA for a lot of good ideas and research on pharma.  Nobody on that site cares.  The boards are just recycling old information and innuendo and even posters are getting bored.  Volume, as I already mentioned, is drying up.

There are no large short positions in the stock, the financials are pretty good for a pharma company, they just raised a great deal of cash…all good stuff.  But nothing is moving the stock.

Let’s look at the chart to see if we can get some insight there:

DDSS is putting out PR that they are expecting to announce a marketing deal soon and begin the rollout of their newest drug, Oleptro, in the 3rdQ of 2010.  What are we to do until then? jk

For those who are already in the stock and underwater (Jeff and Anat), I wish I had a working crystal ball.  My hunch is that this level is a durable base in the stock and it should bounce off of this level given news or an increase in buying pressure.  Anyone new to the stock should watch for any breaks off of this level.  A break down should be “cutting your losses time” and any upwards bounce should be bracketed tightly.  Absent any stellar news from the company, any bounces might be short-lived.

Good luck and let me know YOUR thoughts on DDSS.  I will post the best comments in a blog later in the week.  My email is editor@investorsoup.com.

Good luck and good trading,

Jeffrey Dean, Editor

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