Advaxis, Inc. (ADXS) stock plummeted more than 10.5% on Thursday, extending its losses to more than 25% over the past five trading sessions. Despite the substantial multi-day decline, the company has not reported any major news aside from holding its annual Investor & Analyst Day on June 12 after the drop had already begun. Management outlined the company's registration trials along with European Union regulatory and commercial plans at the meeting.

From a fundamental standpoint, the company has several ongoing clinical trials with some impressive early data. Its LM therapies alter live strains of Listeria monocytogenes bacteria to generate cancer-fighting T cells targeting cancer antigens. Clinical trials have shown these immunotherapies to be well tolerated with anti-tumor activity, which could translate to a successful product or partnership in the future if successful in later trials. The downside is that the firm continues to burn cash as it develops its clinical pipeline. (For more, see: EMA Certification Paves Way for Advaxis Drug.)

Chart showing the performance of Advaxis, Inc. (ADXS) stock over the past year

From a technical standpoint, the stock broke down from its 50-day moving average and trendline support at around $8.11, S1 support at $7.38, and S2 and trendline support at around $6.68 to just above the psychologically important $6.00 level. The relative strength index (RSI) is deep in oversold territory at 23.31 – suggesting that a relief rally may be likely – but the bearish moving average convergence divergence (MACD) suggests that it could be a "dead cat bounce" rather than a long-term trend higher.

Traders should watch for a relief rally in the near term given the oversold conditions, but the overall sentiment remains extremely bearish. The next major trendline support levels are at around $5.22, which were last reached back in early 2016, but traders are likely to see some consolidation in the near term as the market comes to terms with a price. (To read more, check out: Risks and Rewards of Biotech Companies.)

Charts courtesy of The author holds no position in the stock(s) mentioned except through passively managed index funds.  

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