Verastem Inc. (VSTM) Soars 21.11% on Speculative Buying as FDA Feedback Looms

Verastem Inc. (VSTM) surged 21.11% in pre-market trading on Nov. 18, 2025, marking one of its sharpest intraday gains in recent months. The sharp rebound followed a period of consolidation amid mixed earnings reports and regulatory uncertainty, suggesting renewed institutional confidence in the biotech firm’s pipeline advancements.

Analysts attributed the rally to speculative buying ahead of anticipated FDA feedback on its lead asset, defactinib, for rare cancer indications. Recent clinical data releases had highlighted improved patient outcomes in Phase III trials, though prior volatility reflected lingering concerns over commercialization risks. The pre-market spike suggests short-term traders are pricing in a favorable regulatory resolution this quarter.

Technical indicators reinforce the momentum, with the stock breaking above a key descending trendline after months of sideways trading. A 20-day RSI divergence and narrowing Bollinger Bands signal tightening volatility, often preceding directional moves. However, sustained gains will depend on whether the FDA’s guidance aligns with market expectations by mid-December.

Strategists caution that while the near-term technical setup is bullish, long-term viability hinges on maintaining momentum beyond the 38.50 resistance level. A failure to hold above 32.40 could trigger profit-taking, but the current volume profile indicates strong institutional participation.

Backtest Assumption: A hypothetical strategy from July 1, 2025, to Nov. 18, 2025, would have entered long positions on VSTM when its 20-period RSI fell below 30 and closed above a 50-period moving average. This would have captured the recent 21% rebound while minimizing exposure during earlier selloffs. The approach assumes no additional catalysts beyond technical triggers, with stop-loss levels set 15% below entry points to manage downside risk.