ELN Short Squeeze

WOW. My 7.50 calls on ELN really paid me off today. I seriously didn't expect ELN to shoot up, considering theres been no developments in the Tysabri reviews.

Today's action was really unexpected. Like I mentioned in my Wallstreet Crooks post a few weeks ago, ELN usually doesn't go up like this for no reason. I looked at the chart for today, and it doesnt seem like it was triggered by a news leak because the volume wasn't that suspicious (but I'll still be exhilirated if 1808 trials are restarted soon).

I'm going to guess that today's action marks the beginning of ELN's short squeeze. In the conference calls, both Elan and Biogen hinted at big Tysabri developments in September. September is almost here, and shorts may be getting nervous with their positions. There has also been a report that the ACC-001 Immunoconjugate for Alzheimer's will enter Phase I clinical trials in September. For some reason, though, the ACC-001 news doesn't show up on ELN's press release site. Nevertheless, September should be an interesting month for ELN, and shorts may be covering in the next few days to because ELN could become very volatile soon.

The image on the left is data for the short interest in ELN (courtesy of Short Squeeze). 10% of the outstanding shares are sold short, which is a moderate amount. Just for comparison, AMGN and GOOG have short interests of only 2%.

Disclaimer: I hold long positions in ELN.