This is a pattern known as High Flag Consolidation (it's still not complete, but it usually takes no more then 3-4 days to complete) whereby a stock consolidates at the *highs* of the significant move on *decreasing* volume (shorts mistakenly consider this as "weakening"). Support is easily identified by "tails" on the subsequent candles, resistance is at the move candle high. Entering at support (around $7.60-$7.80 currently) gives the best risk/reward, entering at a break above resistance ($8.70-$9) is the most reliable though.
The chart: http://tinyurl.com/r4tf5
Some short traders pick stocks like VSNT (or BITS most recently) because they are lazy. Instead of finding high probability setups involving a major support level breakdown, they just scan for RSI>80 or a gain more then 30% etc. and then pick a stock and say: "pump, went too far, good short" etc., when in fact they could only get peanuts shorting these (not talking intraday but rather a 1-2 weeks timeframe because intraday you can scalp-short almost anything).
Not to say that this set-up is bulletprof but it's very reliable or, in other words, highly probable (~90% chance of success). This pattern works even better if the stock in question has low float.
Our subscribers will be all over VSNT early next week...
Again, I really don't get much usefullness from your "knowing" things. The market has spoken and i have made some money because of the recent runup of the price - due to real earnings which have nothing to do with sale of WebSphere practice. Everyone is entitled to their opinion, but please back it up with real facts, not your crystal ball knowingness and all you shorts stop spreading incorrect facts.
BTW, insider holding is 16%, a very decent amount if you ask me.
As I said before, one more very profitable quarter and VSNT will head toward 15!
One can speculate about the future, that was not the just of my post. It was that the reason for the recent runup of the price was due to two profitable quarters.... nothing I have seen (even a 5% turn down today) can dispute that fact.
The market has already spoken and what is has said is that this stock is on the rise from it's low point 6 months ago. One more very profitable quarter and we should see 10-14 range, no amount of bashing can take away the fact that this company is NOW earning money as the CEO's guidance had indicated and Jochen has turned things around!
spec_trader; I don't have the time right now to point you to all the information that leads me to my conclusions. i know i am right on this one. the market knows it too. if i have time later tonight, i will post another message pointing you to where you need to look to understand the income statement and balance sheet - info that makes me certain that this is a STRONG SELL. good luck!
Sorry, I just don't agree.
Very few publicly traded companies have 20% or more owned by insiders. Witte has a substantial stake in VSNT and this has merit and it's just false to say there is no "significant" insider holdings (or as the original post said, 0 insider holdings).
Financials do NOT reflect taking costs out and leaving revenue in of WebSphere practice - as cost of services were substantially higher this quarter than previous ones and included WebSphere practice. YOU need to take a closer look at latest financial statement before you tell me to take a look.
Bottom line is that the stock is up because VSNT had two consecutive quarters of profit, one being a record profit, and the prospects for meeting Witte's projections of 1.6 Mil to 2.0 Mil for fiscal year is VERY likely. It's these kind of positive turnarounds that have led the stock price to move up, not pumping as has been suggested on this board.
BTW, I have seen pumping on this board for years, it really does not have much affect on the stock price - but profits do!
Versant has, in the attached financial statements, reflected the results of operations of the WebSphere consulting practice for the quarters ended January 31, 2006, October 31, 2005 and January 31, 2005, as discontinued operations. Therefore, reported revenues for these quarters no longer include revenue from the WebSphere consulting practice.
I told you before to play the game properly! Stick to that!
spec_trader - the other poster is right, justs needs to explain a little better.
1) "No insider ownership" - better explained as HARDLY ANY INSIDER OR INSTITUTIONAL ownership (way less than 20 %, after one big holder recent sold). this is why stock will continue to fall, as there isn't enough incetive/support to hold it up.
2) "Company only showed a profit by selling WebSphere practice" - Better explained by saying - with the sale of WebSphere, they took the headcount/operating overhead out of the most recent earnings, but trailing revenues were still booked. Therefore, you are fooled into thinking that earnings are improving. Look closely at the financials to understand.
We all know that a bunch of pumpers tried to get momentum going on this stock - and obviously faild. we all aslo know how the story ends on these low float pump and dump stocks. i feel bad for those who get lured into these traps by the manipulators.
dude, you cant use technical flag indicators on this stock because there wasn't any volume before thursday. only technicals that apply are volume/sales since the day traders started playing with the stock on thursday. technicals since thursday's initial runup show that buy momentum fizzled and sellers are in control. this stock is certainly going down- no doubt this one day wonder was manipulated upwards by churning because of the low float. now thoses pumpers were exposed and most already abandoned the stock. this looks more like a "RED" flag from here, alerting the smart ones to sell - not buy!