Got one for you...ZGNX

This stock is experiencing an overenthusiastic response in the market due to something that may or may not be approved in the future:

Why Shares in Zogenix Are Soaring Higher

Zogenix shares continue to rally on optimism surrounding its treatment for Dravet syndrome.

What: Following news that a phase 3 study of fenfluramine will kick-off later this year in Dravet syndrome patients, enthusiastic investors are sending shares in Zogenix (NASDAQ:ZGNX) surging higher.

So what: After meeting with FDA regulators, Zogenix plans to file an IND for two phase 3 studies of low-dose fenfluramine, the former anti-obesity drug, to evaluate its ability to limit seizures in Dravet syndrome patients.

Zogenix plans to begin enrolling patients in these trials in the fourth quarter, and overall, the company plans to enroll 105 patients, up from prior expectations of between 40 and 60 patients.

The news removes some uncertainty tied to Zogenix's ability to reinvigorate the heavily-maligned fenfluramine, which alongside phentermine, was formerly sold as Fen-phen and was withdrawn from the market in 1997 due to heart risks.

Now what: Zogenix's future trials could build upon the success of an ongoing long-term study of fenfluramine in 12 Dravet syndrome patients, 10 of whom remained on fenfluramine treatment following the end of a prior study that wrapped up in 2012. Overall, 80% of these patients achieved a 75% or higher reduction in the number of seizures annually. Importantly, none of the patients discontinued treatment, and there have been no significant cardiac adverse events reported among these patients.

Whether or not that solid long-term data is confirmed by Zogenix's upcoming late stage trials remains to be seen. As many as 40% of drugs fail in phase 3 trials, so there's a lot that can still go wrong for this drug.

Granted, there's a significant need for new treatment options for Dravet syndrome patients, so it's worth keeping an eye on how this study progresses, but I'm unwilling to chase this stock higher for two reasons. Firstly, because Dravet syndrome is a rare disease with a small patient population, and secondly, because there are other ongoing late stage studies evaluating the chemical cannabinoid CBD in Dravet syndrome that could limit Zogenix's commercial opportunity.

Now lets take a look at its projected numbers:

Ok, on first glance you see that there is a lot of red on the table, but then wait...look at that growth est. That would show that people might be doing a 2 week pile on with this as its earnings are going to be in the fist week of August. However people can also see that it missed its last 3 out of 4 quarters with a negative earnings suprise. Now lets look at its chart:

This seems to be a pile on with no candle today that says top. Technically speaking, this could keep rising manically into the overbought territory.

Now, here is what this is: I think this is a crazy momentum play and people are going to pile on this for another day or two as it has heat. Then I think its going to pull back a bit. The candle today is strong, its not a time to short it. Also earnings are on the way and it may be attempting a 2 week pre earnings climb with the news that its going to be entering a phase 3 study.
So I am going to purchase a call on this and look to exit within 2 days, then look for a good time to get in with a short as the puts on this thing are not trading with high volume.
My in today with this:

So we watch and hold for about 2 days then bail and look for a short point.

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