VaxGen Looks Quite Enticing (VXGN)

With the recent completion of VaxGen Inc.’s VXGN merger with private, biopharmaceutical firm diaDexus the stock has been seeing huge, institutional volume. Before the merger, which was consummated five trading days ago, the stock was seeing 10-day average stock volume in the neighborhood of 30,000 shares. Since the completion of the merger was announced, though, the 10-day average volume is jumping every day. Currently, it is 131,084 shares, but given that I have personally been monitoring volume on the name over the past few days, I can tell you that the stock has been trading over 250,000 shares per day. So, the average volume figure is slightly deceiving. 250,000 shares per day versus 30,000 shares per day is an 833% increase in the daily trading volume. From the night before the completion was announced until today, the stock has risen over 36%. Traders should consider taking a look at this lottery stock. On a technical basis, the recent volume has pushed the stock above the 18-day moving average, which is often an early signal as to the beginning of a new bull trend. The merger is basically a bet on diaDexus’s coronary heart disease blood test, which is the only blood test cleared by the FDA to assess risk for coronary heart disease and ischemic stroke, the #1 and #3 cause of death, respectively, in the United States. VaxGen is based in South San Francisco, California and is focused on the development and commercialization of patent-protected in vitro diagnostic products addressing unmet needs in cardiovascular disease. Disclosure: I purchased VXGN the day before the merger announcement and remain long the stock.