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Medical 3D-Printing Company Organovo (ONVO) Plunges Past Support, 200-Day SMA

By  +Follow March 27, 2014 5:35AM
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Shares of small-cap 3D-printing company Organovo (ONVO) plunged in early trading on Thursday, losing over 10 percent on heavy volume before recovering to losses close to 9 percent. The company, which makes 3D printers capable of replicating human tissue for use in laboratory settings, didn’t have a clear news item that would appear to be driving selling. However, the stock has been experiencing a general pullback from the 52-week high it reached on November 18 last year.

Shares opened down about 1.5 percent at $8 and plunged to close to $7.50 before recovering to hover around $7.75 for much of the morning. The major losses didn’t begin to mount until just before 11:30 am ET, at which point volume increased heavily and shares fell sharply, hitting a low of $7.16 apiece and mostly trading below $7.25 a share.

The timing and size of the move would seem to indicate a specific piece of news sparking a sell-off, but there weren’t any particular actionable news items to speak of. The company had presented at the 2nd Annual Regen Med Investor Day on Wednesday, but it’s unclear that any of the content of that presentation could be at the root of the day’s move.

Technical Factors, Chart May be Culprit for ONVO Sell-off

A close look at the chart patterns, though, may indicate some technical factors that could have helped motivate the run. Since a heavy sell-off in mid-November when the rumored buyout that appeared to be spurring a huge spike failed to materialize, the stock has been pulling back significantly, falling over 40 percent from its 52-week high to the closing bell yesterday. However, throughout this pullback, shares appeared to have strong support at $8 since crossing that level in early November.

Since reaching its 52-week high, a triangle pattern appeared to be forming as resistance kept falling and a second, rising support level approached it. As such, the more-recent sell-off that started on March 18 and had shares down over 7 percent through yesterday appeared to be a downward breakout from that pattern.

However, today’s open price began flirting with that long-term support level at $8 and dipped below it, the first time shares had hit that level in almost five months. After trading below $8 for much of the morning, it’s possible that traders started to get the sense that the important barrier wasn’t going to hold and a bounce back wasn’t forthcoming. A sentiment that was probably reinforced when the stock crossed its 200-day SMA from above at about $7.50 a share.

More Correction...or a Buying Opportunity?

However, the potential for a bounce-back in the next few days also appears strong based on the technical profile of the stock and given that the sell-off doesn’t appear to be motivated by the specifics of the company but rather a general pullback from an artificial high created by buyout rumors.

The breaking of the support level at $8 may not hold for long, and bargain buyers may see it as a chance to get in on a company with a very hot technology with a potentially bright future. 3D printing is an industry that very likely has much to look forward to, and Organovo is one of the more unique plays in that segment.

That sentiment is likely to be bolstered by anyone considering the 14-day RSI and 14-day stochastic RSI for the stock. Today’s sell-off has pushed the 14-day RSI below 30.00, a level that’s traditionally considered the barrier for oversold territory. And the 14-day stochastic RSI has been below 0.20, also traditionally the barrier for a stock being considered oversold, since yesterday.

Finally, the timing of the move could be important. Monday marks the end of Q1 2014, what could be an important barrier for some on the buy-side constrained by the need to keep their quarter-end balance sheets looking clean. The markets have seen a relative volume halt in the approach to the end of the month, potentially fueled by fund managers sitting in a holding pattern until the calendar turns over to April. If any of these actors are waiting for the start of Q2 before acting on any value plays, it could bode well for Organovo investors.

Of course, it’s also just as possible that its current trading level is still correcting for the buyout rumors that drove it to previous highs and the stock will continue this decline, perhaps even picking up speed having now broken its previous support level. This would seem even more possible if one buys into the idea that health care stocks are currently in a bubble after a wild 2013 that saw biotechs making major gains.

Given the young segment and the relatively small size of the company, any predictions about future price movements likely aren’t of much value. And only time will tell if the bulls or the bears win out on Organovo in the long run.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer


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Results for ONVO
David Garon
30 Jul 15 00:38:36
Number of StockTwits followers: $ONVO - 1585 / $AMGN - 573 / $ILMN - 508 ... Can someone explain why $ONVO isn't getting more love?
SmallCaps
30 Jul 15 00:04:03
http://t.co/JqX1kz8hYt SuperTrades student on track to $1 million profit 1st year trading! $ADXS $RTRX $ONVO $ECIG $FB $TWTR $LIVE
Michael Cook
29 Jul 15 23:58:55
Our Stock Alerts Gained Over 550% This Month Already! See Our Huge New Pick Coming This Week: http://t.co/abs4Q0eCx9 $ONVO $BTG $LNG
Michael James
29 Jul 15 23:52:26
After A MASSIVE 525% Gain On $GEQU, We Have A New Pick Ready! Special Update: http://t.co/wFGuoXnIev $ONVO $BTG $LNG
Paul Henry
29 Jul 15 23:52:11
Our Penny Stock Picks Have Gained 3,600% In 10 Months! Get Early Access To Our Next Pick: http://t.co/xXdYdpAiFK $ONVO $BTG $LNG
Michael Cook
29 Jul 15 21:43:36
Our Stock Alerts Gained Over 550% This Month Already! See Our Huge New Pick Coming This Week: http://t.co/abs4Q0wdoH $STNG $ONVO
Paul Henry
29 Jul 15 21:41:31
Our Penny Stock Picks Have Gained 3,600% In 10 Months! Get Early Access To Our Next Pick: http://t.co/xXdYdpiHOc $STNG $ONVO
Michael James
29 Jul 15 21:40:04
After A MASSIVE 525% Gain On $GEQU, We Have A New Pick Ready! Special Update: http://t.co/wFGuoXnIev $STNG $ONVO
PennyStock Zone
29 Jul 15 18:38:02
[Free Video] http://t.co/NZsuLWAAjQ <-- The Dirty Little Secrets of the Pennystock World! $ONVO $GBX $INFA $CLVS $JPM #stocks
Faizal Jaffer
29 Jul 15 17:51:04
RT @HarryWalkman: $ONVO Stock Report on Organovo Holdings Inc (NYSEMKT:ONVO) http://t.co/ejAY2tf4tx
Paul Henry
29 Jul 15 17:04:12
Our Penny Stock Picks Have Gained 3,600% In 10 Months! Get Early Access To Our Next Pick: http://t.co/xXdYdpAiFK $ONVO $BTG $LNG
Michael James
29 Jul 15 17:02:50
After A MASSIVE 525% Gain On $GEQU, We Have A New Pick Ready! Special Update: http://t.co/wFGuoXnIev $ONVO $BTG $LNG
BoardCentral
29 Jul 15 17:00:04
$ONVO "Who is friving Richardisalone dram car?" on Yahoo! Finance message boards: http://t.co/KUmqLpEREm
HokieZ28
29 Jul 15 16:54:50
@daytradernovice $BOJA doing really well, $LUV missed my profit lock by a couple pennies yday, picked up some $ONVO today for a tramp play
BoardCentral
29 Jul 15 16:00:04
$ONVO "Who is friving Richardisalone dram car?" on Yahoo! Finance message boards: http://t.co/KUmqLpngMO
HokieZ28
29 Jul 15 15:21:03
Bought some $ONVO today at 3.52, double bottom on daily, 19% short w/ 11 days to cover
dailystockplays.com
29 Jul 15 14:49:56
Stochastic Buy http://t.co/EK3LkVtMaF $LOCK $SEE $OIH $RUSL $EXC $CVEO $BEN $EDC $SPN $PTEN $KSS $CPE $BBBY $BBG $ONVO $PSEC $DISH $RIO
A
29 Jul 15 13:14:29
@GCulturePodcast $ONVO nice. And $TRTC still running
Michael Cook
29 Jul 15 13:14:26
Our Stock Alerts Gained Over 550% This Month Already! See Our Huge New Pick Coming This Week: http://t.co/abs4Q0wdoH $STNG $ONVO
Michael James
29 Jul 15 13:11:34
After A MASSIVE 525% Gain On $GEQU, We Have A New Pick Ready! Special Update: http://t.co/wFGuoX67mX $STNG $ONVO
Jon Vince
29 Jul 15 12:42:33
Nice to see pop on poor lil $ONVO today. Almost mentioned thot way oversold on Mon. Seemed like 'contrived walk down' ( @SleemStockPicks )
Paul Henry
29 Jul 15 12:39:16
Our Penny Stock Picks Have Gained 3,600% In 10 Months! Get Early Access To Our Next Pick: http://t.co/xXdYdpAiFK $STNG $ONVO
WatchTheFunds
29 Jul 15 12:23:02
$ONVO Institutional ownership up 13.43% Q/Q, with 2,493,370 net purchase http://t.co/wBctdJeyOk http://t.co/fxhbpUXvGP
TC_TRADER
29 Jul 15 11:53:53
$ONVO bouncing off the bottom it had at the end of March and 3 times in 2013
Michael Cook
29 Jul 15 11:37:04
Our Stock Alerts Gained Over 550% This Month Already! See Our Huge New Pick Coming This Week: http://t.co/abs4Q0eCx9 $ONVO $BTG $LNG
Paul Henry
29 Jul 15 11:23:29
Our Penny Stock Picks Have Gained 3,600% In 10 Months! Get Early Access To Our Next Pick: http://t.co/xXdYdpiHOc $ONVO $BTG $LNG
Harry Walkman
29 Jul 15 10:38:02
$ONVO Stock Report on Organovo Holdings Inc (NYSEMKT:ONVO) http://t.co/ejAY2tf4tx
MoneyEmpire
29 Jul 15 10:21:54
$ONVO 5%
Alexander Morris
29 Jul 15 10:19:15
$ONVO: At 1DyHIGH=3.51, hits:2, ch:+4.2%, 0phNearHi, FltBO-, AtPivR1, 19:3Accel+, tf:0111111, medFlt:75M, HiPctSht[28%:11d],
GreenCulturePodcast
29 Jul 15 10:07:04
$ONVO 3.50 pivot point for ONVO. LETS GO
Jeffrey Blake
29 Jul 15 09:16:07
$ONVO Can Organovo Holdings Inc. Bounce Back? http://t.co/rY15iQqeup
StockenheimerSchmidt
29 Jul 15 08:42:09
Huge Gains On Stock Picks, Plus A Major Announcment: http://t.co/L7DCrvU4Ev $STNG $ONVO
Michael Cook
29 Jul 15 08:36:11
Our Stock Alerts Gained Over 550% This Month Already! See Our Huge New Pick Coming This Week: http://t.co/abs4Q0eCx9 $STNG $ONVO
Paul Henry
29 Jul 15 08:31:32
Our Penny Stock Picks Have Gained 3,600% In 10 Months! Get Early Access To Our Next Pick: http://t.co/xXdYdpAiFK $STNG $ONVO
Michael James
29 Jul 15 08:30:13
After A MASSIVE 525% Gain On $GEQU, We Have A New Pick Ready! Special Update: http://t.co/wFGuoXnIev $STNG $ONVO
Sweet Platform
29 Jul 15 08:22:22
ONVO Top news - Jul 29th, 2015 $ONVO http://t.co/0cDNNM2VNn
Michael Cook
29 Jul 15 07:31:51
Our Stock Alerts Gained Over 550% This Month Already! See Our Huge New Pick Coming This Week: http://t.co/abs4Q0eCx9 $ONVO $BTG $LNG
Paul Henry
29 Jul 15 07:31:50
Our Penny Stock Picks Have Gained 3,600% In 10 Months! Get Early Access To Our Next Pick: http://t.co/xXdYdpiHOc $ONVO $BTG $LNG
StockenheimerSchmidt
29 Jul 15 07:26:37
Huge Gains On Stock Picks, Plus A Major Announcment: http://t.co/L7DCrvU4Ev $ONVO $BTG $LNG
Stocks News&Markets
29 Jul 15 07:26:02
$FDML up 11.94% today! Check out this trade http://t.co/1YCVVT96oc I made 15.50% on $ONVO JOIN US LIVE: http://t.co/5pEVjDSajC
GreenCulturePodcast
29 Jul 15 06:48:22
$GPRO needs to get above 62. just resting #cupandhandle $ONVO putting in the second bottom #doublebottom
Wall Street
29 Jul 15 06:13:03
The Penny Stock Superstar team voted #1 OTC trading group. http://t.co/cQ0lLTokka Related: $MY $RENN $MBI $ONVO $EAPH
Wall Street
29 Jul 15 05:42:10
The Penny Stock Superstar team voted #1 OTC trading group. http://t.co/cQ0lLTokka Related: $MY $RENN $MBI $ONVO $EAPH
StockenheimerSchmidt
29 Jul 15 04:50:47
Huge Gains On Stock Picks, Plus A Major Announcment: http://t.co/L7DCrvU4Ev $STNG $ONVO
StockenheimerSchmidt
29 Jul 15 03:54:38
Huge Gains On Stock Picks, Plus A Major Announcment: http://t.co/L7DCrvU4Ev $ONVO $BTG $LNG
Michael James
29 Jul 15 02:06:02
After A MASSIVE 525% Gain On $GEQU, We Have A New Pick Ready! Special Update: http://t.co/wFGuoX67mX $ONVO $BTG $LNG
StockenheimerSchmidt
29 Jul 15 00:36:26
Huge Gains On Stock Picks, Plus A Major Announcment: http://t.co/L7DCrvU4Ev $ONVO $BTG $LNG
WatchTheFunds
29 Jul 15 00:24:02
$ONVO Institutional ownership up 13.43% Q/Q, with 2,493,370 net purchase http://t.co/wBctdJeyOk http://t.co/XBp8bwa47I
StockenheimerSchmidt
28 Jul 15 21:32:46
Huge Gains On Stock Picks, Plus A Major Announcment: http://t.co/L7DCrvU4Ev $ONVO $BTG $LNG
Michael James
28 Jul 15 20:45:59
After A MASSIVE 525% Gain On $GEQU, We Have A New Pick Ready! Special Update: http://t.co/wFGuoX67mX $STNG $ONVO
				
				
By  +Follow March 27, 2014 5:35AM
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