The selloff in early August was not surprising. The stock was trading above $14 for a bit after the news, which was a dollar plus gap higher from the close. So it was buy the rumor, sell the news, and also some insiders exercised options, AND the company had just filed a $150M shelf. That is what drove the stock down, but only for a few weeks. It was smart of the company to file the shelf then and allow the stock to cool off, and I would not be surprised if they were asked to do so by a few market makers.
The reversals off exhaustion gap selloffs (coincident with great news, especially earnings related) can be powerful -- and we've seen exactly that.
I remember all the boo birds with that selloff. They were the ones selling in small lots as if they were waiting on the news of a big revenue ramp to sell the stock. The LAST thing we needed was a dollar gap in price that would have had to fill at some point. We got exactly what we needed for the long term.
Let's focus in on what news are they going to release on Tuesday ahead of two big conference this week, including presentations and investor meetings. Anyone?
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