Seattle Genetics Surges on GlaxoSmithKline Pact

On the heels of Monday's announcement, SGEN was up more than 3%. The stock is positioned north of its 10-week moving average, which has acted as stiff resistance since early October. Further north, SGEN will likely face a challenge at the round-number $10 level. This psychologically significant region has rejected the equity's rally attempts for roughly two months.

In fairness, Seattle Genetics does have a respectable supply of sideline cash to help it challenge these looming technical barriers. Short interest on the shares rose by 13.8% during the past month, and now accounts for 7.2% of the equity's float -- or roughly 10.2 times the stock's average daily trading volume.

However, judging by Monday's early price action, most of these bears are still firmly entrenched. SGEN's positive momentum appears to have fizzled out near $9.50, suggesting that most skeptics aren't exactly screaming in terror for the exits.

Elizabeth Harrow is a senior equities analyst and financial writer in the research department at Schaeffer's Investment Research. She is featured in the video series Schaeffer's Daily Q&A on SchaeffersResearch.com.