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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.


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Results for ONVO
PennyStock Zone
20 Dec 14 03:43:53
http://t.co/8HTFYrgtXq <- A decent informational video from millionaire trader Tim Sykes $SIRI $S $ONVO $LQMT $KWK $CNET
IH News Desk
20 Dec 14 03:40:43
$AMAT Stock Forum Updated Saturday, December 20, 2014 06:11:24 AM $HIMX $YUM $ONVO $EWA http://t.co/FGmq32gtxM
IH News Desk
20 Dec 14 03:40:37
$MUX Financials Updated Saturday, December 20, 2014 06:11:24 AM $MRK $ONVO $CVX $ORCL http://t.co/meeZ46xBKt
PolgarStocks
20 Dec 14 03:25:09
$BP Percent Change Updated Saturday, December 20, 2014 06:07:24 AM $ETN $ONVO $BP $XRT http://t.co/9PQT356Xah
Rosner Stocks
20 Dec 14 03:24:40
$VHC Stock Price Updated Saturday, December 20, 2014 05:59:25 AM $ONVO $XOM $GS $PFE http://t.co/EWvUSRkEH3
IH News Desk
20 Dec 14 02:39:13
$IBM Company Info Updated Saturday, December 20, 2014 05:11:23 AM $PCLN $ONVO $WLL $BP http://t.co/q89CTyEgPj
Maleah
20 Dec 14 01:50:26
http://t.co/6I8VNnRkyA <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
Stockaholics
20 Dec 14 01:36:49
Platinum Memberships Rose, After 528% Gains On Penny Stocks, In One Month! Big Update: http://t.co/2W3yKD2d5Q $ONVO $BTG $LNG
PolgarStocks
20 Dec 14 01:24:16
$VHC Stock Price Updated Saturday, December 20, 2014 04:07:25 AM $BBBY $ONVO $USO $EPI http://t.co/JmcKn2gQdr
PolgarStocks
20 Dec 14 01:24:10
$BEAV Short Sales Updated Saturday, December 20, 2014 04:07:25 AM $ONVO $EWY $RSP $GGAL http://t.co/dNzDQW8URP
Rosner Stocks
20 Dec 14 01:22:40
$PCLN Last Price Updated Saturday, December 20, 2014 03:59:26 AM $EWA $VDSI $MDY $ONVO http://t.co/GANsl2mduv
Rosner Stocks
20 Dec 14 01:22:34
$ONVO Reviews Updated Saturday, December 20, 2014 03:59:26 AM $XHB $ECIG $IMSC $MUX http://t.co/HZNGTfI7Be
Russell Barbour
20 Dec 14 00:45:39
http://t.co/fmOyM2OPtD <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
PennyStock Zone
20 Dec 14 00:39:45
http://t.co/8HTFYrgtXq <- A decent informational video from millionaire trader Tim Sykes $SIRI $S $ONVO $LQMT $KWK $CNET
PennyStock Zone
19 Dec 14 22:50:23
http://t.co/8HTFYrgtXq <- A decent informational video from millionaire trader Tim Sykes $SIRI $S $ONVO $LQMT $KWK $CNET
Maleah
19 Dec 14 22:04:34
http://t.co/6I8VNnRkyA <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
Stockaholics
19 Dec 14 21:29:19
Platinum Memberships Rose, After 528% Gains On Penny Stocks, In One Month! Big Update: http://t.co/2W3yKD2d5Q $ONVO $BTG $LNG
PolgarStocks
19 Dec 14 20:18:37
$IYT Opinions Updated Friday, December 19, 2014 11:07:23 PM $ONVO $XLU $GILD $IMSC http://t.co/ssUMbaF772
PennyStock Zone
19 Dec 14 19:52:28
http://t.co/8HTFYrgtXq <- A decent informational video from millionaire trader Tim Sykes $SIRI $S $ONVO $LQMT $KWK $CNET
Joe K
19 Dec 14 19:35:25
@JeaYu21 Looks like $ONVO is sitting pretty from here
Rosner Stocks
19 Dec 14 19:15:11
$ONVO Stock Forum Updated Friday, December 19, 2014 9:59:24 PM $RSP $EWZ $RSX $ECIG http://t.co/trQ2ucVmKs
Rosner Stocks
19 Dec 14 19:15:08
$MDY Reviews Updated Friday, December 19, 2014 9:59:24 PM $VZ $XLP $ONVO $ANF http://t.co/BWVKRIVZoh
Langan Stocks
19 Dec 14 18:17:08
$LUV Short Sales Updated Friday, December 19, 2014 9:03:24 PM $AAPL $DBA $SMH $ONVO http://t.co/pZNVJdKbnX
Langan Stocks
19 Dec 14 17:16:42
$AA News Updated Friday, December 19, 2014 8:03:24 PM $MA $AA $ONVO $RAD http://t.co/FM27gLGcFF
Rosner Stocks
19 Dec 14 17:13:41
$YPF Percent Change Updated Friday, December 19, 2014 7:59:24 PM $ONVO $YPF $SCTY $EFA http://t.co/E8C8EnJKuF
Russell Barbour
19 Dec 14 15:50:17
http://t.co/fmOyM2OPtD <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
Tracy Nanthavongsa
19 Dec 14 15:24:41
@Organovo awesome close! Make me proud for 2015! $onvo
Stockaholics
19 Dec 14 14:55:33
Platinum Memberships Rose, After 528% Gains On Penny Stocks, In One Month! Big Update: http://t.co/2W3yKD2d5Q $STNG $ONVO
Maleah
19 Dec 14 14:52:46
http://t.co/6I8VNnRkyA <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
Large Void Bot
19 Dec 14 14:00:17
Popular: $INO, $ONVO, $ABBV, $MACK, $RUSL, $SPLS, $DNR, $ALIM, $MSG, $ESBF, $YHOO, $VRTX, $PCTY, $HME, $ALXN, $OSUR, $LHO
3DPrintingStocks.com
19 Dec 14 13:29:17
$DDD $SSYS $XONE $AMAVF $VJET $ONVO are the components of the "3D Printing Stock Index" which rose 1.4% today @ https://t.co/85G7vTNUpa
Jeff Caldwell, II
19 Dec 14 13:23:08
Great days from $GWPH $ONVO $INO and $MINE I'm only in $MINE but these are all my favs
Ethan28
19 Dec 14 13:17:48
Santa Claus Rally is here as we can see strong volume and price action today - $FOLD, $MACK, $ONVO, $ARWR
Edel Gonzalez
19 Dec 14 13:12:03
$ONVO ho ho ho ho here comes another ;)
Steve Bouman
19 Dec 14 13:00:17
@pennystocksusa $ONVO ------------->
Jon
19 Dec 14 12:52:10
lemme guess there's a 7 #doller $ONVO strike... #OpEx #games $STUDY
Magic
19 Dec 14 12:50:42
@BigMoneyUp liking the price action on $ONVO if it can finish close to 7.15 area. Needs a volume push though. http://t.co/5Lc02a1GcL
Big Money
19 Dec 14 12:36:26
$ONVO http://t.co/uBXFOOBkv3 towards the bottom... Looks like the type of article they publish in magazine later
Maleah
19 Dec 14 12:00:10
http://t.co/6I8VNnRkyA <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
SmallCaps
19 Dec 14 11:50:20
http://t.co/7cnaGTmDi4 <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
Joshua Kidd
19 Dec 14 11:30:21
$ONVO is definitely a great buy! http://t.co/3rfmlbThjf
Russell Barbour
19 Dec 14 10:49:39
http://t.co/fmOyM2OPtD <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
POWCOIN
19 Dec 14 10:32:17
RT @HarveyDentist: Last time I tweet my holdings ///// $ONVO $APT $SIMH $RIGH
Brian Riley
19 Dec 14 07:54:57
$ONVO looking for it to finish a W pattern
Penny Stock Secret
19 Dec 14 07:43:30
Make Money With BitCoin Every Single Day More Info Here http://t.co/SVqoMlijqL .. $STNG $ONVO
Jon
19 Dec 14 07:36:05
Just had an $ONVO $SRPT market cap cross again - just to give you some perspective. #TGIF
PennyStock Zone
19 Dec 14 06:50:33
http://t.co/8HTFYrgtXq <- A decent informational video from millionaire trader Tim Sykes $SIRI $S $ONVO $LQMT $KWK $CNET
Penny Stock Secret
19 Dec 14 05:12:16
Make Money With BitCoin Every Single Day More Info Here http://t.co/SVqoMlijqL .. $ONVO $BTG $LNG
Russell Barbour
19 Dec 14 04:36:44
http://t.co/fmOyM2OPtD <--- Amazing subscriber to Super_Trades - check out his profit chart!! $ZNGA $SIRI $S $ONVO $LQMT $KWK $CNET
usasingh11
19 Dec 14 03:41:22
RT @OphirGottlieb: Unusual Biotech Option Volume (pic) $IMGN $OREX $ONVO $VVUS $ACHN - order flow from--> http://t.co/u4N6fcKpqK http://t.c…
				
				
By  +Follow March 27, 2014 5:35AM
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