Acadia Pharmaceuticals (ACAD)

Company

"ACADIA Pharmaceuticals (Nasdaq: ACAD) is a biopharmaceutical company utilizing innovative technology to fuel drug discovery and clinical development of novel treatments for central nervous system disorders. We currently have five programs in clinical development as well as a portfolio of preclinical and discovery assets directed at large unmet medical needs and major commercial markets. Our four Phase II-stage clinical programs, for which we have retained worldwide commercialization rights, are ACP-103 for treatment-induced dysfunctions in Parkinson's disease, ACP-103 as an adjunctive therapy for schizophrenia, ACP-103 for treatment of sleep maintenance insomnia, and ACP-104 for treatment of schizophrenia. We also have a neuropathic pain program in Phase II clinical trials in collaboration with Allergan." (company website)

Buy

27-Oct-06. Acadia has been on my buy list for some time. After bottoming near $5 it advanced rapidly then consolidated around $8.75. When it broke out of that, it got too far ahead to buy in; after peaking at $10.55 it pulled back, and I was aiming for a buy-in at about $9. However, at around $9.25 it started going back up again, so I jumped in today at a higher price. The market soured after I bought in, and unfortunately ACAD closed below my buy price.

• Price momentum (PPO) — long period of positive momentum
• Trend (ADX) — above threshhold (20), and buying pressure (+DI) is picking up again after pullback
• Money flow (CMF) — modest inflow
• Relative strength (RSI) — long period of average or above average strength
• Volume — big volume on turnaround from 52-week low, but has been falling since then

Sell

29-Nov-06. This didn't start well (above), and it ended worse. The stop-loss order for ACAD was triggered today and the shares sold for $8.88.

Looking back at the chart, the indicators in the immediately preceding week were diverging from the the general trend. Whereas there had been a rising period, they were falling in the week just before the buy. I'm going to have to look back at other trades that have soured to see if that pattern holds true. If it does, I may be able to avoid more of the losses that I have suffered.