MELI Voted Off the Island?

I recently put MELI on my watch list as a stock worth keeping an eye on because of its solid fundamentals and potentially sound consolidation pattern. However, Tuesday it took a huge hit in big volume, indicating serious selling.
While it found support at its 200 day moving average and finished the day in the upper half of its range, the action should give one pause. It’s possible it could recover or form a double bottom (but you wouldn’t want it to go much further below its recent bottom), but it gets pushed off my hot list for now.

If you didn’t have a chart to look at, you could easily conclude that it’s a sound company given its results. 136% EPS growth and 47% sales growth would make any company happy, but these results missed expectations. That’s all it takes.

Additionally, MELI has felt the “Hugo Chavez” effect. Because the socialist dictator-in-the-making devalued Venezuela’s currency, it cost MELI $7 million in revenue. Ah, the joys of Latin American stocks. How many other stocks have exposure to Venezuela? Makes one wonder.

For now, MELI has been voted off the island.