QLT Inc. (QLTI)

Company

"QLT is a global biopharmaceutical company specializing in developing treatments for cancer, eye diseases and dermatological and urological conditions." (company website)

Sell short

3-Jul-06. QLTI has been in a long downtrend (sidebar) for the past year. A nascent recovery failed in May.

• Price momentum (PPO) — picked up for test of 50-day average, but flattening out
• Trend (ADX) — slight pickup in buying pressure (+DI) during test of 50-day average, but falling again
• Money flow (CMF) — negative, although tending toward neutral
• Relative strength (RSI) — neutral, at best
• Volume — average volume is falling sharply

Sell

10-Aug-06. QLT's earnings report and their announcement of a big share buy-back at between $7 and $8 per share disrupted the clear downtrend that was in place. With buying pressure (+DI) above selling pressure (-DI) I decided to cover the short rather than wait around to see if the downtrend might continue. With a pharmaceutical company, everything can change with the announcement of a test result or FDA approval, and at this price level there's no room for a surprise. I ended up with a slight loss consisting of my trading expenses.