In short, time will tell. Yesterday’s gap down was a prompt rejection of the 200 DMA
(day moving average), and may be the catalyst for shares to move lower and retest
lows. The 50 DMA recently crossed over the 100 and 150 DMA, but yesterdays price
action was also rejected by those levels as the stock tried to rebound from beneath
them.
The ailing daily deals site suffered a loss of $0.12, but this may be a turnaround
point as the stock traded over 100 million shares. From a fundamental prospective,
the business model is being questioned as players like AMZN and GOOG join the
scene, for the barriers to entry are minimal. Additionally, the stock has been a
target of shorts as there was early controversy of GRPN’s accounting practices.
The graphic below is GRPN.
