Over the past quarter or so, we've grown accustomed to stocks such as Agouron (AGPH) or Vivus (VVUS) losing or gaining $10 in five trading days. The activity of momentum investors, who are selectively re-entering the sector, may shed some light on the phenomenon

Nearly a year ago, momentum players provided the cornerstone for the biotech rally in the first half of 1996. In that market, momentum investors seemed to pick up any security with "biotech" or "pharmaceutical" in its name, with stocks in all tiers experiencing price appreciation.