VSTM slides to lowest close since March 18th
Verastem Inc. (VSTM) Technical Analysis Report for Jul 02, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, VSTM finished Thursday at 1.67 edging lower $0.01 (-0.6%), notably underperforming the S&P 500 (0.45%) ahead of tomorrow's Independence Day OBS market holiday. Today's close at 1.67 marks the lowest recorded closing price since March 18th. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (VSTM as at Jul 02, 2020):
Thursday's trading range has been $0.05 (2.96%), that's far below the last trading month's daily average range of $0.11. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for VSTM. Prices continued to consolidate within a tight trading range between 1.62 and 1.72 where it has been caught now for the last three trading days.
After having been unable to move above 1.70 in the prior session, the stock ran into sellers again around the same price level today, missing to move higher than 1.70. The last time this happened on June 17th, VSTM actually gained 3.45% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Trading close to May's low at 1.61 we might see further downside momentum if potential sell stops at the level get activated.
Among the two market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Its common bearish interpretation has been confirmed for Verastem. Out of 258 times, VSTM closed lower 54.26% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after two trading days, showing a win rate of 53.10% with an average market move of -0.36%.