1:00pm (EST)

The market is trading in a tight range as the bulls try to push the Dow higher for a fourth straight session.  The index’s 3-day winning streak has been its first since April as the bulls also look to take the market to higher ground for the second straight week. 

At halftime, the Dow is up 11 points, or 0.1%, and is at 10,445.  The index has touched a high of 10,483 so far and the next level of resistance will come in at 10,500-525.

The S&P is higher by 2 points, or 0.1%, and is at 1,117.  The index has traded to a high of 1,121 and faces resistance at 1,125. 

The Nasdaq has just turned lower by 2 points, or 0.1%, and is at 2,304.  The Tech-heavy index has made a high of 2,321 today but has a hurdle at 2,350.

There isn’t much in the way of “breaking” headline news (well, we take that back, BP (BP, $32.08, up $0.37) JUST announced its CEO is passing off his duties) but a couple of Drug stocks we have on our Watch List are moving in opposite directions today. 

We first profiled Vivus (VVUS, $10.03, down $0.57) when it was a $5 back in January 2009.  Check our archives to the left of the home page for the original article.  

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The company has a potential blockbuster drug with Qnexa, a treatment for obesity that could get FDA approval by the end of October.  Late-stage clinical trials went well but the stock has slipped some this week after a few Wall Street analysts raised concerns about how U.S. regulators will view the safety of the weight loss drug.

Next month will be important as an outside panel makes its recommendation to the FDA.  The latest concerns are that the FDA may get tougher on cardiovascular safety testing on new drugs for obesity.

Vivus is the best bet to capture this lucrative market as Wall Street believes Qnexa could be the next “Billion Dollar Baby” based on the weight loss observed in clinical testing.  We don’t like playing options on stocks under $10 but we have played Vivus in the past. 

This is one of those cases if you wanted some action you could play it a number of ways.  As a stock play, you could nibble here at these levels with a tight stop set at $8 and a target of $13+ which is where its 52-week high is.  As an option trade, we are going to take a look this weekend at what the risks are with doing a straddle or strangle option trade on Vivus.  We will let you know what we find out on Sunday night with the Weekly Wrap.

Elsewhere, Amylin Pharmaceuticals (AMLN, $19.00, up $2.49) got a huge jump at the open this morning after Roche said it ran into a speed bump with its diabetes drug, Taspoglutide.  Amylin’s drug, Byetta, faced some competition but is already generating revenues for the company.

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That’s all we have for today so we will see you Sunday night!  Subscribers, check the Members Area for the latest QUOTE updates on the current trades.

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