Market Overview

Johnson & Johnson Cashes Out Of Aquinox Pharmaceuticals' Parabolic Rally

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Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.

Aquinox Pharmaceuticals Inc (NASDAQ: AQXP) shares were trading lower by $3.53 (13 percent) at $17.48 in Wednesday's session. Resistance in the issue has been rapidly coming down after it skyrocketed from last Thursday's close ($1.79) to an intra-day high of $55.75 on Monday before falling back to settle that day at $18.88. The issue posted its all-time closing high on Tuesday at $21.01.

However, the intra-day high has come down significantly since Monday's mind-boggling $55.75 print. In Tuesday's session, the issue peak at $30 off the open before declining all the way to $15.51 and posting its all-time high close.

After a lower open in Wednesday's session, it peaked ahead of the close at $20.50 before breaking down into the $17 handle.

It should be noted that when aggressive high frequency and momentum traders were buying the issue over the last two days, one of its largest shareholders was selling. Over the last two days, Johnson & Johnson (NYSE: JNJ) disposed of 1.514,821 shares at an average price of $22.41. Now the company's remaining stake stands at just 100,000 shares.

Also, the $33 million plus sale represents nearly 15 percent of the $225.37 million market cap for a company that has a never shown a profit and has yet to reach final approval for its potentially blockbuster drug AQX-1125 for treatment of interstitial cystitis.

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