VSTM Longterm view - multiyear base building and breakout
Updated
VSTM is using the past 3 years to build a long cup and handle formation, we have seen longterm resistance 6.59 broken with a big enough accumulation to offset previous big sell-off spike. It seems like it wants to try to test mid 7 soon. Breaking 7 could be an easy one with the current momentum.
There might be some serious resistance between 8.3 to 9.8. With the target as high as $17, it will be eventually broken, depending on R&D news, FDA approval, investment, and BO rumors/offers. It seems tough times is behind, we will see how this goes.
* Note: use this as reference only, don't buy any stocks without your own research and DD. This is opinion, not advice.
There might be some serious resistance between 8.3 to 9.8. With the target as high as $17, it will be eventually broken, depending on R&D news, FDA approval, investment, and BO rumors/offers. It seems tough times is behind, we will see how this goes.
* Note: use this as reference only, don't buy any stocks without your own research and DD. This is opinion, not advice.
Note
Last weekend on June 15, Verastem made major progress presentation during EHA18. The result is impressive, curing cancer is great and its financial payoff is also great. Only a dozen small companies came up with oncology drugs. Approved oncology drugs are rare and valuable. investor.verastem.com/phoenix.zhtml?c=250749&p=irol-newsArticle&ID=2354840
For example, Ariad Pharma was taken out for 5.2B USD. So sooner or later, we might talk billions. FDA, execution, new pipeline, all take time.
reuters.com/article/us-ariad-pharm-m-a-takeda-pharma-idUSKBN14T1F7
EHA news is very significant, with such stellar result, it might have a frontline treatment in development and become a platform company. As a result, VSTM Stock popped, hitting 9.0X 52WH at some point. However, as previously noted, there is serious resistance between $8-9. It retreated back to the first $7.41 Fibonacci line.
Looking forward, with the help of addition to Russell 2k index, VSTM should climb/oscillate from mid $7 to $9 again. With future catalyst like EU partner, it will pass $9 and test $10. It takes 10 years to develop a good drug, yet people felt holding stocks for 10 weeks is too long. I doubt jumping in and out counting pennies will beat those who research, believe, buy and forget.
Note
VSTM is forming a bull flag, with the pole top at $9. We are narrowing the trading range and approaching a smaller trading range of $5.67-$5.89. And we are waiting for an event to break $9 and head to $10. Since the current pole height is ~$3. The next target and resistance are around $12. I don't know what will trigger the run-up, but we will see how the break-out will work out.Note
Recommend SA Article by Juha Natunen.Verastem: An Undervalued Rare Oncology Gem With Big Upcoming Catalysts
seekingalpha.com/article/4199215-verastem-undervalued-rare-oncology-gem-big-upcoming-catalysts
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The previous resistance level of $9 has been tested multiple times. After form a classic triangle, it broke out this week. We expect the $9 will become support going forward without significant negative news. Actually, we all expect early FDA approval sometime in Sept. no later than Oct. 5th. After seeing a textbook triangle flag pattern, we expect a breakout pattern to continue. The first range is between $9-$12. If FDA approval is announced, things might get more dramatic. I expect some people will take some chips off the table. However, the future of Verastem looks bright, especially with sales kicking in soon.
Next week: we might test $10, trader love integers. It might get there lightning fast and retreat.
For many long-term VSTM investors, the real show will start... GLTA
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