Northwest Biotherapeutics, Inc (OTC:NWBO) stock was among the top gainers two trading days ago, but as the rally got exhausted, there is now a substantial risk of loss at hand.Such rallies, as the recently witnessed one, often break apart as quick as the price rose. The gains on stock valuation weren’t based on any fundamental changes in this case. The stock was recommended by some analysts as alternative to the more widely recognized Dendreon Corp (Nasdaq:DNDN), as their prostate cancer treatment drug production cant keep up with the demand.[BANNER]
This means the short term revaluation was forced by a bottom bounce and picked up volume while eliminating short sellers’ stop loss orders – otherwise known as the short squeeze scenario. Fundamentals have not caused the rally, and clearly the effect of analyst talks was short lived.
The worrying part is that this rally came in when the overall market showed first signs of weakness upon banks failing to report higher revenues. Since Northwest balance sheet is really worrying, longer term price rallies are just not possible without the broad market support.
Northwest DCVax product candidate for prostate cancer treatment is still in the Phase III trials, which require significant resources to complete. Recent cash raising campaigns gathered another $4.6 million, which should be enough to cover a couple of quarters worth of expenses.
