While we didn’t see much action in Debt Resolve (DRV) last week as it continued to consolidate its short-term overbought condition, it continues to trade above its trendline and we maintain our belief that we could see further upside in the weeks to come.

Last week’s second focus stock, XSUNX Inc. (XSNX), made an intra-week gain of 16 percent on heavy volume; we maintain we could see a price of $0.74, up from its current $0.51, and considerably higher than the $0.44 price from March 28 when we first began coverage.

Market Wisdom

Last week we suggested readers pay close attention to the market’s reaction to the inevitable bad news the ISM and jobs report would reveal.  Our contention was simple - if the bears could not take the market any lower in the face of poor economic news, a bottom could very well be in the making.  A jobs report indicating the loss of 30,000 more jobs than expected didn’t sink the market, and even an admission from Fed Chairman Ben Bernanke that the U.S. economy could enter a recession still resulted in solid weekly gains for the Dow of 3.2 percent, 4.2 percent for the S&P 500, and 4.9 percent for the Nasdaq composite. The character of the market appears to be changing from a “sell on good news” mentality to “buy on bad news.” This continued action bodes very well for the markets over the near term.

This week’s Trade Trends Spotlight: ORMP and VVUS

Oramed Pharmaceuticals (OTCBB: ORMP) Current Price: $0.53

Oramed Pharmaceuticals (ORMP), an Israel-based company focused on the development of oral delivery solutions based on proprietary technology, is currently developing an orally ingestible insulin capsule for the treatment of diabetes.  According to the World Health Organization, diabetes affects approximately 170 million people worldwide, and is expected to affect 300 million by 2025. The global diabetes drugs treatment market is one of the largest segments of the pharmaceutical industry, which has grew by a CAGR of nearly 20 percent from around $4 billion in 1995 to more than $17 billion in 2006. Overall anti-diabetic drug sales are expected to grow significantly over the next five years to more than $22 billion in 2012 as the addressable patient population continues to increase. In 2005, the United States accounted for about 50 percent of the world market.

 In the past, trials to develop an insulin pill or capsule failed due to the fact that insulin, which is a protein, breaks down in the digestive system. Oramed is one of only a handful of companies set to change that.

Recent Developments:   The Hadassah Medical Center in Jerusalem recently granted approval to begin Phase 2A studies of its oral insulin on diabetic volunteers. This Phase 2A study is designed to evaluate the safety and efficacy of Oramed’s oral insulin capsule on Type II diabetic volunteers. This study is slated to begin this quarter.

Technicals:  After appearing to bottom on December 26, 2007, with an intraday low of $0.20, the stock increased to an intraday high of $0.66 in a little over a month. After that positive move, the stock worked off its overbought condition by consolidating in a 22 cent range between $0.67 and $0.45 on decreasing volume. This decreasing volume during a bout of profit taking suggests that many of those investors who were going to take profits after that impressive move have already done so. With a possible exhaustion of selling pressure and the approval to begin phase 2A studies immediately, this stock looks “well-rested” and ready to possibly embark on profitable move higher over the coming weeks.  The recent and successful retest of the short-term support level of $0.45, as well as the emergence out of over-sold territory in the stochastics and potential bullish crossover in the MACD, offers additional evidence that this is a stock worth considering.

Consideration: Consider accumulating the stock on any weakness while maintaining an upside price objective of $0.91 and a stop-loss at $0.42 for aggressive traders and stop-loss at $0.35 for longer-term traders.

Vivus Inc. (NASDAQ: VVUS) Current Price $6.43

California-based Vivus Inc. is a 17 year old pharmaceutical company that develops therapetic products addressing obesity, post menopausal and sexual health. Its investigational product pipeline includes Qnexa, which has completed a Phase II clinical trial for treating obesity; testosterone MDTS that has completed Phase II study to treat hypoactive sexual desire disorder; Avanafil, which has completed Phase II clinical trial for the treatment of erectile dysfunction; and ALISTA, which has completed Phase IIb study for the treatment of female sexual arousal disorder. The company also markets MUSE for the treatment of erectile dysfunction.

Recent DevelopmentsOn April 1, 2008, VIVUS  Inc. announced that it has successfully completed and reached agreement with the U.S. Food and Drug Administration (FDA) regarding the Special Protocol Assessment (SPA) for the Phase 3 efficacy trials for Luramist, testosterone metered dose transdermal spray (MDTS), for the treatment of hypoactive sexual desire disorder (HSDD) or low libido in women. In addition, VIVUS reached agreement with the FDA on the safety requirements necessary for approval. With the finalization of the SPA and the agreement on the safety study, the clinical and regulatory path to approval for Luramist has now been clarified. Last Friday the company announced it was entering into a $30 million funding collaboration for Phase 3 Studies of Avanafil for erectile dysfunction.

Technicals: After reaching an intermediate term bottom of $4.28 in early November 2007, Vivus increased to an intraday high of $6.55 in late January. After consolidating its gains for the last eight weeks it looks as though all the recent positve news may be enough to break the “coiled  spring” and push the stock out of its increasingly tight trading range. This is supported by the fact that the stock reached a new 52-week closing high of $6.45 on above average volume last Friday, and has created a bullish ascending triange over the last five months. Other confirming technical indicators include the recent bullish MACD crossover, strong uptrends for the stochastics and RSI, and a stock price that is trading above its 13, 50 and 200 day moving averages.

Consideration: Consider accumulating shares on any weakness with a price objective of $10 over the next several weeks. A stop-loss could  be considered at $5.25.