After months of losses, Exelixis, Inc. (NASDAQ:EXEL), Celsion Corporation (NASDAQ:CLSN),
and Telestone Technologies Corporation (NASDAQ:TSTC)
may all feel like they should be seen as undervalued bargains. Sometimes though, stocks CAN lose more ground. It looks like these three are perfectly content with their current slides, so much so they're going to sustain them.
For Exelixis, Inc.,
the tumble from $12.50 in April to a low of $4.82 in early October was a nasty cut. But, the new low and the train-track reversal effort on the 3rd and the 4th implied - at least partially - that EXEL had finally hit bottom and was ready to heal. That bounce effort has already petered out though, and this chart is already back under the 20-day moving average line.
When you take a step back and look at a longer-term daily chart of EXEL, it's pretty clear a pattern has been established, and it's not about to break now. This biotech name has been completely unable to clear major hurdles (moving averages), and each failed encounter with one has simply sent Exelixis, Inc. to lower lows. This week's encounter with the 20-day average line (blue) doesn't look like it's going to be any different.
Along the same lines as Exelixis, Inc. is Telestone Technologies Corporation,
only in this case it's a much more organized stair-step pattern that's guiding the stock lower. Over the past several months TSTC has managed to find support two or three times at new floors, and then break under them. And as was the case with EXEL, the move that kick-starts the breakdown is usually a final retest of a short-term moving average.
The next floor for TSTC is $3.90, where it hit lows in early October before making a tepid rebound that's already started to fade (which just happened to start fading as the 50-day moving average was approached). While the smart move seems like it should be to wait for Telestone Technologies to actually move under that floor before acting, that may be too late. The breakdowns (under support) have been reliable, but not all that big. To capture a move of any significant size, a trader may have to jump on it on faith before a breakdown.
Finally, though Celsion Corporation
has been a favorite among small cap enthusiasts this year, the fact of the matter is that it's not been a fruitful stock, and may have just tipped over into the wrong side of the momentum spectrum. CLSN has fallen under the 200-day moving average line, and despite today's gains (+0.36%), doesn't appear like it's going to be able to put together a quick rebound effort.
The final bearish straw is the way CLSN has cemented this effort in pace with a string of lower highs and lower lows (orange). Assuming this zig-zag pattern holds true, Celsion Corporation shares are destined for $2.00 before a recovery is even close to being likely. (And just for the record, this isn't the first time we've seen this bearish channel being made by Celsion. In 2008 and 2010, crosses under the 200-day averages were just the beginning of a long string of lower lows and lower highs.)