Trius Therapeutics' Bullish Technical Trade Set-Up Print E-mail
By M.E.Garza   
Thursday, 10 January 2013 00:00

icon_techanalysisShares of Trius Therapeutics (NASDAQ:TSRX), rose to $5.50 +0.26 (4.96%) after we first told our premium subscribers about the technical trade set-up based on recent fundamental developments.

Shares of the biopharmaceutical company focused on the discovery and development of innovative antibiotics for serious infections looked interesting to traders after the firm recently announced that the U.S. Food and Drug Administration (FDA) has designated the company's Phase 3 antibiotic candidate, tedizolid phosphate, as a Qualified Infectious Disease Product (QIDP).

Tedizolid phosphate is a once daily, IV and orally administered second generation oxazolidinone in Phase 3 clinical development for the treatment of serious gram-positive infections, including those caused by methicillin-resistant Staphylococcus aureus (MRSA).

Observers see new designation as a benefit to Trius in multiple ways and "should be looked as another chain in the link completed to commercialization of the product."

As pointed out by John Eastman, a preliminary, unaudited financial from the company indicates that as of December 31, 2012, the company had cash, cash equivalents and investments totaling $66.0 million.

Trius, currently trading at $5.25 with a 52 Week Range of $4.41 - $6.78.

Technically, you can see below that "The Head and Shoulders Bottom," sometimes referred to as an Inverse Head and Shoulders, is a pattern that shares many common characteristics with its comparable partner, but relies more heavily on volume patterns for confirmation.

As a major reversal pattern, the Head and Shoulders Bottom forms after a downtrend, and its completion marks a change in trend. The pattern contains three successive troughs with the middle trough (head) being the deepest and the two outside troughs (shoulders) being shallower. Ideally, the two shoulders would be equal in height and width. The reaction highs in the middle of the pattern can be connected to form resistance, or a neckline.

Shares have now broken out above the 200 day moving average. If the bulls continue to push the stock could hit our short term price target opinion of somewhere between $5.80 and $6.00 or higher.

Disclosure: None

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