Joel Elconin is the co-host of Benzinga’s #PreMarket Prep, a daily trading idea radio show.
Biogen Idec Inc (NASDAQ: BIIB) shares were trading lower by $9.07 (2 percent) at $466.91 in Monday’s session. One session removed from making its all-time high ($480.18) and closing high ($475.98), the issue has been in the red since the opening bell.
The catalyst for the negative session may a downgrade from Stifel, from Buy to Hold over concerns over the lack of upcoming data along with it being overvalued. The firm is still maintaining its $451 price target, but does not believe the results from the trials announced on Friday will be confirmed before 2018.
Traders seized on the downgrade off the open, as Biogen opened sharply lower (Friday’s close $475.98 vs. Monday’s open of $466.07). However, after a decline of little over $1 reaching $465.12, it sharply reversed course. This may be attributed the shorter-term players in the stock that could not resist to cover shorts initiated the issue as it rallied over $40.00 on Friday. The instant gratification along with the “buy the dippers” boosted the issue to $474.00.
Since failing to reach its all-time closing high ($475.98), it began to drift lower but has yet to make a new low for the day. If the intraday low is breached, there may not be any identifiable support until Friday’s low ($456.06).
Editor’s note: At time of publication, shares were down $12 (2.6 percent) at $463.82.
See more from Benzinga
- Major Profit-Taking In Biogen As It Bolts To New All-Time Highs
- iShares NASDAQ Biotech ETF Pulls Back Off All-Time Highs
© 2015 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.