- NASDAQ: CATB has surged by 28.22% on Wednesday, hitting a new 2020 high.
- Premarket trading indicates another double-digit rally for Catabasis Pharmaceuticals Inc.
- Some suspect a short-squeeze may be in play.
- Fundamental developments needed to provide a long-term move.
A leap of some 50% in a span of two days – an impressive feat for a stock that has no news to back the surge. What is going on with Catabasis Pharmaceuticals Inc (NASDAQ: CATB)?
One theory surrounding the leap is that short-sellers have given up on their positions, allowing the surge. Covering these positions triggered caused some buying, which was later seized by others who jumped on the bandwagon. Fear Of Missing Out (FOMO) has been one of 2020's main themes in stock markets.
Another speculation comes from rises in Catabasis' peers. Auris Medical Holding Ltd (NASDAQ: EARS), nearly quintupled earlier this week. The surge in EARS was prompted by a coronavirus-related announcement, giving it a genuine reason to rise. Are speculators looking for the next pharmaceutical wonder? Small pharmaceutical firms can jump rapidly on any announcement these days.
Zooming out of recent market moves, it would take a material announcement from the firm, such as on its Edasalonexent novel oral investigational drug for Duchenne muscular dystrophy or its CAT-5571 medication for cystic fibrosis and mycobacterium tuberculosis to make CATB a longer-term investment.
CATB stock price
NASDAQ: CATB has been on an uptrend since mid-November when it traded below $1.40. Shares of the Boston-based pharmaceutical company advanced gradually to just above $1.60 before surging to close at $2.09 on Monday, a 28.22% leap.
The rally is set to continue, with Thursday's pre-market session pointing to another jump of over 13% to $2.38. It is essential to note that trading volume has leaped in recent days, giving the increase a dose of credibility despite the lack of any material development.
More NIO Stock Price and Forecast: Extends collapse as Chinese EV makers drop, NKLA buy opportunity eyed
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.