What: Valeant Pharmaceuticals (NYSE:VRX) rose throughout the day and was up almost 10% at 3:45 p.m. EST on no real news.

So what: Valeant has been battling back over the last two weeks after hitting rock bottom. It almost hit $100 per share today -- a symbolic, albeit meaningless, mark.

VRX Chart

VRX data by YCharts.

But zoom out and you'll see Valeant Pharmaceuticals has a long way to go to hit its previous high.

VRX Chart

VRX data by YCharts.

After multiple rounds of bad news, it was practically inevitable that the stock would overshoot its true value on the way down and then rebound. Investors naturally have to price in the potential for more bad news. And then when it doesn't materialize, the stock rebounds. We've seen this story many times before.

Now what: The question is whether this is the end of the bad news cycle.

Clearly, talk of drug pricing, which started this downturn, isn't going away. It's an election year, after all. But whether the government will be able to do anything about high drug prices and what effect that might have on Valeant is less clear. Management has already said it wants to step away from increasing revenue by buying companies and raising the price of their drugs.

Investors seem to be shrugging off worries of accounting irregularities, which accelerated the downward spiral, in large part because they haven't been substantiated. Even a report about low inventory turnover in Poland today didn't have any negative effect on the stock.

It's hard to predict where Valeant Pharmaceutical's shares go from here because it's trading more on sentiment than fundamentals. After a quarter or two of earnings releases, it'll be easier to see the full impact of the company's new strategy -- including ending its relationship with specialty pharmacy Philidor RX Services -- on the long-term financials.

Brian Orelli has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Valeant Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.