[isatrader]

Another one for the watchlist: XLRN
I was going through some stock queries on the P&F site of Tom Dorsey and came along XLRN (sector Drugs).
The filter was set for favored sectors + large base stocks + price $10 - $500 + weekly momentum between 0 and 3 weeks positive (on average, weekly momentum lasts positive or negative during 7 weeks).
+ Favored sector
+ RS trend positive
+ Weekly momentum 3 weeks positive
- Monthly momentum 6 months positive
+ The Reward to risk is 2.37 to 8, depending on the calculation (I love to have the RR above 3).
+ Initial risk to stop loss is 10%
+ P&F Triple top breakout
+ Stage 2a or 2b?
Any other thoughts?

Some charts see this padlet: http://padlet.com/Amedee/5214bepuenhb

Sorry for the slow reply. Has a busy week at work.

XLRN technically made an early Stage 2A breakout attempt back in December, but it didn't meet all of the breakout requirements. Note the weak close on the weekly bar of the breakout attempt week, which needs to be in the upper third of the bar at the close of the week for a confirmed Stage 2A breakout imo, as a strong weekly close is required.

When a breakout fails it moves back into Stage 1, and redefines the Stage 1 range to give a new breakout level to watch. So it's forming what I call a raised Stage 1 base currently, as the entire Stage 1 base is forming above the 30 week MA. And so in order to make a new Stage 2A breakout attempt it would need to make a strong close above the $43 level which has become near term resistance (see P&F chart attached) with all the usual requirements.

Anyone that had bought in on the initial Stage 2A breakout attempt could still be in it, as it hasn't violated the investor stop loss and technically looks strong still. But highlights one of the issues of buying an early breakout attempt when there's not a well formed Stage 1 base, which ideally should be six months or more imo - see the Stage Analysis Study Guide - Questions and Answers thread for more on that.