XpresSpa Group Inc (XSPA)

[tobinator00]

Something spooked the shorts today.

I keep hearing that 2 day old news caused the price and volume surge today. I call BS on that theory. Today was the highest close since January 11th. It was also the 3rd highest volume of the year, which was 500,000 shares shy of the YTD high.

I have followed the daily trade of Vringo for a year now. I can't recall a single occasion that the price spiked higher on absolutely no news. We have seen price spikes on Ravicher's about face in January, Microsoft and Vringo in settlement talk news, the Microsoft settlement and the inclusion to the Russell 2000.

This stock has been in near complete control by the short side but something happened today that we have no idea what the catalyst was. My Spidy senses think that today's trade has something to do with ZTE. I do not believe that HJMJ has leaked his decision concerning Google nor do I believe Google will settle and today's trade was based on that speculation. After all, Google settlement speculation has been around for the last 18 months.

Institution funds just don't pick a day to accumulate or cover all at once, unless they have gotten wind of something that guarantees their success on a trade (or limiting damage). What we saw today is heavy institutional involvement in this stock. Retail investors have absolutely no juice left in them to bid this stock up like today on this large volume.

On a 1 year chart, Vringo has been stuck in a trading channel for the last 8 months. Technical traders will be looking for a move to $4.40, which is the upside price objective for breaking through (and closing three times over) $3.50. The same channel yields a downside target around $1.75 for breaking and holding the support level of $2.63.

1 Year Vringo Chart:
http://stockcharts.com/h-sc/ui?s=VRNG&p=W&yr=1&mn=0&dy=0&id=p32997353223&listNum=3&a=310237835

Looking at the short term chart, we can see price spikes over $3.20 do not last more than 1 day. What I would like from a technical perspective is to hold this level next week. Utopia would be a surge and hold of $3.50 over the next few days. This will show us if this price action is "different this time" and determine if the short side is about to get religion.

Short Term Chart:
http://stockcharts.com/h-sc/ui?s=VRNG&p=D&yr=0&mn=4&dy=0&id=p57700612870&a=298953728&listNum=3