Volume surged on one of the hottest Nasdaq penny stocks, Arena Pharmaceuticals, Inc. (NASDAQ: ARNA), in yesterday’s trading session. ARNA traded 58.6 Million shares, 3X its 5 Day average and 11X its YTD average volume as the European Union reviews ARNA‘s diet drug which is considered to be the safest of the three that are currently awaiting approval from the FDA. Volume should continue to surge as short sellers get squeezed out of ARNA.
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ARNA was upgraded by analysts at Piper Jaffray from a “neutral” rating to an “overweight” rating and given a $3.00 price target on November 28th of last year which the penny stock reached yesterday to close at $3.01. The surge in volume was mainly attributed to the pending E.U. decision but also on Bloomberg report issued yesterday which indicated ARNA short interest to be 27,818,636 shares compared to Average Daily Volume of 3,431,741.
ARNA is in an extremely bullish trend YTD and most recently surging off the charts in both RSI and MACD indicators. RSI (14) is 87.87 while MACD (12 26) is 0.15.
There were 96,612 trades on ARNA yesterday with an average trade size of 606 shares. Clearly ARNA is going to be a hot penny stock for many days to come with the pending FDA approval and also the incredible surge in stock price YTD.
YTD, ARNA has gained 60.96%, 110.49% since our Alert on the penny stock November 28, 2011.