CTI BioPharma Corp (NASDAQ:CTIC) stock price has been badly hurt by the result of the fourth quarter and the full year ending at 2014, 31st December. Particularly the EPS reported at a loss of $0.27 was much lower than the market expectation of a net profit of $0.18. The fourth quarter in 2013 showed a net profit of $10.2 million. Coming to the full year of 2014, the net loss came to $0.65 per share against a loss of $0.43 in 2013. The margins of loss clearly show the disappointment the market felt, resulting in a vertical drop in the stock price, losing 25% in just a single week.
Just before the result, the stock had seen some gain as CTI BioPharma Corp (NASDAQ:CTIC) had informed that a study evaluating its candidate Pacritinib, a JAK2 inhibitor, met its primary endpoint in phase 3 trials with positive top-line results. The excitement over this piece of news is quickly fading out now as the street realizes that unless the company delivers a positive result of its second phase 3 trial, no sustainable gains can be expected.
Technically, the last week’s price action has obviously weakened the structure with the sharp cut of 25%. While the volume has spiked up as usual in a selloff, the trendline resistances shown on the chart, make the weakness look like a foregone conclusion.
Using the log scale to clearly identify the lower levels, the major supply area around $5 can be easily marked. The price structure in the last few years looks similar to a bullish Cup & Handle pattern but the handle is too long for a powerful pattern and the trendline resistance is yet to be broken above. Investors may avoid any bottom fishing here and search for better opportunities elsewhere.
DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of USmarketsDaily.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: