Charts of Insmed Incorporated, La Jolla Pharmaceutical Company, and Pacific Capital Bancorp are rated and reviewed.

I want to clarify right from the beginning that I’m not wild about one aspect of the three stocks we’re going to be looking at below. What’s the problem? All three are (in my view anyway) bullish setups. There’s nothing inherently wrong with that - particularly if the market remains bullish, or even tepid. I don’t like being so one-sided though, especially when the broad market’s this overbought. Nevertheless, here’s a look at Pacific Capital Bancorp (NASDAQ:PCBC), La Jolla Pharmaceutical Company (NASDAQ:LJPC), and Insmed Incorporated (NASDAQ:INSM).

With my first look at Insmed Incorporated (NASDAQ:INSM) way back on November 17th, I was speculatively bullish - a call founded on the fact that the stock had traded above a falling resistance line, and was moving higher on growing volume. It took a while to get going, but as of today, INSM is finally making good on that potential.

In the meantime I’ve added two horizontal resistance lines for INSM… or perhaps I could more accurately call it a resistance ‘zone’ between $0.80 and $0.83.  Either way, Insmed Incorporated blew through both of them today with the move to a high of $0.92. So, we’re up about 15% on our hypothetical trade. (Hopefully it isn’t just hypothetical for you.)

At this point though, I don’t know if Insmed Incorporated shares are at a great entry level. I’ve got a sneaking suspicion we’ll see INSM retest one or both of those resistance levels as support, meaning you’ll be able to get in at a better price than $0.89. I bring it up today just to let you know the bulk of the major bullish work has been done with the punch through the ceiling.

Pacific Capital Bancorp (NASDAQ:PCBC) may well be one of the biggest rebound opportunities I’ve seen in a while. You can’t see this on the zoomed-n chart I had to use below, but considering PCBC was trading in the $20’s not that long ago, this recent upswing has me curious.

Even without the huge upside possibility though, I’d like PCBC for its recent technicals. Since November we’ve observed horizontal resistance around $1.30, while a rising support line has kept shares of Pacific Capital Bancorp moving higher. In fact, that line was the springboard for today’s surge to $1.44.

That move was clearly above the big resistance line, but Pacific Capital Bancorp did NOT hold those gains; they fell back to $1.25 instead. A problem? I don’t really think so… not yet anyway. The volume was strong today, and I’ve got a feeling PCBC will get and stay above that ceiling soon enough. Once it does, yes, it’s a strong buy.

Though it’s not really an issue just yet, the recent rebound from La Jolla Pharmaceutical Company (NASDAQ:LJPC) could make it an issue pretty quickly. So, here’s a pre-emptive trading perspective on LJPC.

In short, there’s a lingering resistance zone between $0.32 and $0.34 that could still halt any rally effort from LJPC in its tracks. How do I know? Well, nothing’s ever certain, but we’ve seen this ceiling stop rallies five times (out of six) since this time last year. Eventually, La Jolla Pharmaceutical shares will snap the losing streak - I just don’t want to be a guinea pig in the effort to find out which attempt will be the successful one.

My apologies for the scrunched-up chart below… I wanted to show you all the times that resistance had thwarted La Jolla Pharmaceutical Company strength before. I do think it’s reasonable to assume LJPC will manage to move from the current price of $0.22 towards $0.32 or so. Based on the long-standing history though, I have little to no confidence beyond that.

That being said, if and when from La Jolla Pharmaceutical does manage to crack the ceiling, how big of an upside could that be? Wow! We’ll talk about that when the time comes.

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