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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
StockenheimerSchmidt
28 Mar 15 00:57:05
$RCGP tripled in value within 2 days as of yesterdays high! high! Big News: http://t.co/RWkbY02YnU $STNG $ONVO
SmallCaps
28 Mar 15 00:39:37
http://t.co/LnWZaIJviH <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
Stock Dawgzz
28 Mar 15 00:34:47
Our Penny Stock Alerts Have Gained Over 1600% In THe Past 4 Months! Subscribe Today: http://t.co/nsMnuzW59n $STNG $ONVO
Stockaholics
28 Mar 15 00:13:32
Our Stock Tips Have Gained Over 230% In Less Than 24 Hours! Huge News: http://t.co/FW1zCk5dfw $ONVO $BTG $LNG
Russell Barbour
27 Mar 15 23:36:14
http://t.co/xQoCh2lsYk SuperTrades student on track to $1 million profit 1st year trading! $ADXS $RTRX $ONVO $ECIG $FB $TWTR $LIVE
StockNewsWires
27 Mar 15 23:25:02
$ONVO: Short Interest in Organovo Holdings Grows By 0.5% (ONVO): http://t.co/edKiC3zM80
dailystockplays.com
27 Mar 15 21:34:56
Elder Red http://t.co/3gg9jldk0b $TPVG $RDS/A $ANF $MFA $XCO $HMY $BBEP $GLNG $OVAS $DDD $TEX</B></td> $ONVO $MTZ $TSO $SSRI $ATW $PES $LNCO
cyb0rg ph4nt0m
27 Mar 15 20:50:10
RT @POWCOIN: new order LONG $ONVO / $TLT short Pair trade #swaps
jjsmith77
27 Mar 15 19:19:37
$SGLB $AMAVF $VJET $XONE $ONVO $SSYS $DDD SGLB and Honeywell present 3D GEOMETRY compliance tool at Rapid 2015: http://t.co/4lqTDwYlz4
Bitcoin Hunt
27 Mar 15 19:18:28
RT @POWCOIN: new order LONG $ONVO / $TLT short Pair trade #swaps
Jon Vince
27 Mar 15 15:44:45
Added 50% more $ONVO, $3.66, as it bounced 1% off its ATL today. Stickin it where sun don't shine until they double or get bought out.
 Wolfgang Mueller
27 Mar 15 12:17:37
I really think $ONVO is going to be bought out. I had a dream it happened. Maybe a premonition?
 Wolfgang Mueller
27 Mar 15 12:08:55
@Hipster_Trader Do you think it's purposely being shorted $ONVO prior to a buyout?
3D Prints by Stacy
27 Mar 15 11:36:27
3DPrintsbyStacy: Gopic: Whoa what the heck happened to $ONVO #3DPrinting Organs. This is the future. Feel like this is in the bargain bin. …
3D Prints by Stacy
27 Mar 15 11:30:25
Gopic: Whoa what the heck happened to $ONVO #3DPrinting Organs. This is the future. Feel like this is in the bargain bin. #stocks
POWCOIN
27 Mar 15 11:29:40
new order LONG $ONVO / $TLT short Pair trade #swaps
Kobeissi™
27 Mar 15 11:28:19
Whoa what the heck happened to $ONVO #3DPrinting Organs. This is the future. Feel like this is in the bargain bin. #stocks
Hipster
27 Mar 15 11:27:02
$ONVO whats the deal with this thing? Thought it was the future!
3D Prints by Stacy
27 Mar 15 11:09:08
rapidprototypin: RT 3DNuts: Organovo Holdings Sees Large Growth in Short Interest $ONVO http://t.co/H0hIuB6LZo via RatingsNetwork #3Dpri…
StockenheimerSchmidt
27 Mar 15 11:08:52
$RCGP Has More Than Tripled In Value In The Past 2 Days! Big News: http://t.co/RWkbXZLnwm $ONVO $BTG $LNG
Rapid Prototyping
27 Mar 15 11:06:58
RT @3DNuts: Organovo Holdings Sees Large Growth in Short Interest $ONVO http://t.co/wcXUD1h2M0 via @RatingsNetwork #3Dprinting #BioPrintin…
Stock Rocket
27 Mar 15 11:05:20
Our Penny Stock Newsletter Picks Gained Over 1485%! Huge Update: http://t.co/cDuleLngkJ $ONVO $BTG $LNG
3D Prints by Stacy
27 Mar 15 11:04:45
startuphangar: RT 3DNuts: Organovo Holdings Sees Large Growth in Short Interest $ONVO http://t.co/H0hIuB6LZo via RatingsNetwork #3Dprint…
3D Prints by Stacy
27 Mar 15 11:04:41
3DNuts: Organovo Holdings Sees Large Growth in Short Interest $ONVO http://t.co/H0hIuB6LZo via RatingsNetwork #3Dprinting #BioPrinting #…
Startuphangar.com
27 Mar 15 11:03:22
RT @3DNuts: Organovo Holdings Sees Large Growth in Short Interest $ONVO http://t.co/wcXUD1h2M0 via @RatingsNetwork #3Dprinting #BioPrintin…
3D Nuts
27 Mar 15 11:01:46
Organovo Holdings Sees Large Growth in Short Interest $ONVO http://t.co/wcXUD1h2M0 via @RatingsNetwork #3Dprinting #BioPrinting #stocks
Luc.JJ
27 Mar 15 10:59:11
$ONVO down 5% since I sold it booyahhhh. Should have shorted oil but didnt have the capital. Lost opportunity!
Penny Stockington
27 Mar 15 10:53:08
Our Penny Stock Pick On $RCGP Has Gained Over 236% In 2 Days! Get Our Next Pick Eary: http://t.co/22aEoRrPYm $ONVO $BTG $LNG
StockenheimerSchmidt
27 Mar 15 10:47:31
$RCGP Has More Than Tripled In Value In The Past 2 Days! Big News: http://t.co/RWkbXZLnwm $STNG $ONVO
Keubiko
27 Mar 15 10:39:30
RT @SeekingAlpha: Five Lessons From Ohr Pharma http://t.co/8dUvri6cw2 $CYTR $GALE $ONVO $UNXL $OHRP
Stock Rocket
27 Mar 15 10:34:14
Our Penny Stock Newsletter Picks Gained Over 1485%! Huge Update: http://t.co/cDuleLngkJ $STNG $ONVO
Stockaholics
27 Mar 15 10:29:01
Our Stock Tips Have Gained Over 230% In Less Than 24 Hours! Huge News: http://t.co/FW1zCkmOE6 $ONVO $BTG $LNG
Healthcare Stocks
27 Mar 15 10:22:01
Five Lessons From Ohr Pharma http://t.co/R9nMVTlVlt $CYTR $GALE $ONVO $UNXL $OHRP
Seeking Alpha
27 Mar 15 10:22:01
Five Lessons From Ohr Pharma http://t.co/8dUvri6cw2 $CYTR $GALE $ONVO $UNXL $OHRP
Domenico Traverso
27 Mar 15 10:12:07
RT @3DPrintingStock: $VJET Q4 numbers better than expected with 87% revenue growth + big bottom line improvement: http://t.co/gJatQkE31K $D…
Penny Stockington
27 Mar 15 09:40:52
Our Penny Stock Pick On $RCGP Has Gained Over 236% In 2 Days! Get Our Next Pick Eary: http://t.co/22aEoRrPYm $STNG $ONVO
SmallCaps
27 Mar 15 09:21:18
http://t.co/LnWZaIJviH <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
Daily Contracts
27 Mar 15 09:03:01
Real-Time feed of company contracts, original agreements and executive updates from $ONVO http://t.co/qp8dNvyJjh
Penny Stockington
27 Mar 15 08:55:08
Our Penny Stock Alerts Have Gained Over 1000% So Far This Year! Big News: http://t.co/Mq9GADvqO5 $ONVO $BTG $LNG
StockenheimerSchmidt
27 Mar 15 08:45:21
Our Penny Stock Pick On $THCZ Is Up 321.54% In Less Than 6 Weeks! This is Huge: http://t.co/WroUGtaeZF $STNG $ONVO
Russell Barbour
27 Mar 15 08:38:18
http://t.co/fmOyM2xelz <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
MoxReports
27 Mar 15 07:38:38
$OHRP $ONVO acquire the tech for nothing. churn out PRs. pay for research and incentivize the I banks. standard operating procedure.
Like2trade
27 Mar 15 07:05:58
$ONVO $ibb bio index up 2%
Rapid Prototyping
27 Mar 15 06:12:52
RT @3DPrintingStock: "Voxeljet / $VJET Reports Blowout Q4" @ http://t.co/QvxduY5ZBW #3dprinting $SSYS $XONE $DDD $PRLB $ONVO #shortsqueeze
3DPrintingStocks.com
27 Mar 15 06:07:57
"Voxeljet / $VJET Reports Blowout Q4" @ http://t.co/QvxduY5ZBW #3dprinting $SSYS $XONE $DDD $PRLB $ONVO #shortsqueeze
Russell Barbour
27 Mar 15 03:52:20
http://t.co/xQoCh2lsYk SuperTrades student on track to $1 million profit 1st year trading! $ADXS $RTRX $ONVO $ECIG $FB $TWTR $LIVE
Penny Stockington
27 Mar 15 02:19:57
Our Penny Stock Alerts Have Gained Over 1000% So Far This Year! Big News: http://t.co/Mq9GADvqO5 $STNG $ONVO
Stock Dawgzz
27 Mar 15 01:40:28
Our Penny Stock Picks Have Gained Over 1485% In The Past 4 Months! MASSIVE Update: http://t.co/Nr8lmTigQP $STNG $ONVO
Edy Nolan
27 Mar 15 01:34:38
RT @HARVTRADES: CTO exercised call options 3 days ago right to buy $ONVO 50k shares. now Acquired and owned
Edy Nolan
27 Mar 15 01:26:58
RT @HARVTRADES: $ONVO not doing what i expected .. taking that off ( still holding in my IRA ofcourse)
				
				
By  +Follow March 27, 2014 5:35AM
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