There is a lot of controversy surrounding the stock market today. But the one that’s less controversial and just a clearer losing proposition going forward is Vinco Ventures (NASDAQ:BIG).
Some will dismissively call it a dead cat bounce. Others would say don’t be in a rush to judge as the price action is also setting up a confirmed bullish and critical rally. I’m referring to last week’s huge percentage gains in the broader market after further corrective and bearish cycle lows in 2022. Then there’s BBIG stocks.
Despite the Nasdaq’s 7% price increase, supported by outsized offers in Apple (NASDAQ:AAPL), You’re here (NASDAQ:TSLA), Costco (NASDAQ:COST), Marriott International (NASDAQ:TUE) and others, BBIG stock fell just over 15% on the week.
So what gives Vinco Ventures? Let’s look out and on the BBIG stock price chart and understand why, regardless of what’s happening elsewhere on Wall Street, the tide has turned against having Vinco Ventures owe in any form.
Not much in Vinco Ventures
Vinco Ventures does all the best things, at least on paper. From blockchain to metaverse, short-form social media video to AI-based ad analytics, BBIG stock has its hands full with some of investors’ favorite buzzwords and up-and-coming markets.
As we’ve seen this year though, Wall Street is tougher on unproven growth stories like Vinco Ventures where the only consistency has been producing attractive press releases and lousy fundamentals. And today, BBIG stock is making matters worse, as its debut in a flurrying cryptocurrency market has been delayed.
In a nutshell, Vinco’s blockchain subsidiary, Cryptyde, aims to leverage smart contract technologies in mainstream Web 3.0 marketplaces. It is a pending spin-off in which current BBIG shareholders of record on May 18 receive one share of Cryptyde’s “TYDE” for every ten shares of Vinco Ventures held.
However, the distribution date was postponed last week from May 27 to a vague “during the second quarter” due to “contractual and regulatory conditions”. Nothing like waiting until the last minute, right?
BBIG Stock Isn’t Bigger Than Its Past Stock Meme
Source: Charts from TradingView
Registered shareholders certainly didn’t like the Vinco Ventures news. The delay alone caused the pressure on BBIG stock prices last week. And today, as the broader averages pause and investors wait to make their next move, BBIG is down another 4.7%. Oh no, right? Maybe not.
On the Vinco price chart, the writing is not entirely on the wall for bullish investors to throw in the towel. As seen in the weekly chart shown, stocks have formed a slightly positive lower pattern since undercutting $1.94 in March from a double bottom formed by $2.16 in BBIG shares. Additionally, the price action is supported by a similarly trending stochastic setup.
Above all, bullish BBIG investors still have their work cut out for them. And that may be too difficult to overcome in the long run.
As the Stochastic indicator moves higher, it has also moved lower into neutral territory. Also troubling, May’s confirmed pivot failed below BBIG’s former 76% retracement level. Finally, a classic top-up pattern to further validate a new uptrend missed this positive realization by pennies.
BBIG stock is not APPL stock
Given the ambiguity of BBIG stock on the price chart and the bearish 17% sell interest, it’s possible there’s even less in that $544 million small cap than there is. it seems. Given the implosion of meme stock over the past year, Vinco Ventures is a speculative waste of time and resources in my opinion.
There’s always a chance I’m wrong and BBIG and TYDE stocks will become more than a fuss. Not today, however. And by the way, not last Thursday and probably not “during the second quarter” either.
The bottom line though, if you’re inclined to make lottery bets and can’t be deterred from owning BBIG after its expiration date, keep the bet small enough not to create an insurmountable hole that takes away other core portfolio holdings which investors can and should buy with more confidence in the face of weakness.
As of the date of publication, Chris Tyler does not own (either directly or indirectly) any of the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.