Bull looks for Alkermes to bounce

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The bears have driven Alkermes to a key support level, and now one investor is positioning for a rebound.

ALKS ALKS rose 3.13 percent to $11.22 in afternoon trading. The drug-delivery stock is down 20 percent since March 15, when it gapped higher on optimism about the Bydureon diabetes treatment. Two months later, it plunged on a weak earnings report and has been trapped below $12 since.

Today's option trade, known as a bullish combination, will mimic a long position in the stock and appeared after ALKS bounced off its 200-day moving average. The strategy will double the investor's money for every $0.25 that the stock trades over $12.75 and lose money below $10.

The company is scheduled to make a presentation at the Bank of America Merrill Lynch Small and Mid-Cap Conference at 2:30 p.m. ET today and at the Jefferies Global Life Sciences Conference at 4:30 p.m. ET tomorrow.

Overall options volume in ALKS is 30 times greater than average so far today.

 

(Chart courtesy of tradeMONSTER )

 



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


This article appears in: Investing , Options

Referenced Stocks: ALKS

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