It seems like 3D Systems can’t catch much of a break. The weakness in company fundamentals in response to a faltering environment and heightened competitive risks put this in the sell now, and sell short bucket. Sure, shorting a stock on the way down sounds risky given the lows we’re at currently. But, I don’t see any near-term catalyst to 3D printing names, and the likelihood of an acquisition is extremely unlikely. The stock could easily fall into the distressed category below $3.21 (its current tangible book value). However, until the stock trades below $3.00 I wouldn’t be an aggressive buyer. Instead, traders should look to re-initiate a short as the stock will re-test resistance at the 20-day moving average. Source: Freestockcharts We’re entering the third-day of its rally, and I anticipate that it will at least test the 20-day moving average. But once we turn the leaf over into Friday anticipate the bulls to lose conviction going into the weekend. Furthermore, the low volume indicates that this is more of a short cover rally rather than conviction purchases from the bulls. A near-term catalyst to further selling was the price target reduction by UBS in a report that was released on Tuesday:We are lowering our estimates and price target on 3D Systems. 3D printing is immature in technology, distribution, and customer understanding of how to apply it. It can take years for disruptive technology to enter the mainstream. Both 3D Systems and Stratasys have been experiencing worsening demand, yet both still remain confident in the longer-term opportunity for additive manufacturing and rapid prototyping. We are lowering our price target from $9 to $6 and have changed our valuation methodology from adjusted P/E comparisons to an EV-to-Sales framework given potential restructuring. 3D Systems could fall back to $6.00 and even below. Riding the stock further down offers a better risk-to-reward than many other short ideas out there. Furthermore, the headwinds to sales is also inclusive of cheaper printer supplies sold by Chinese firms in conjunction with competitive threats from Carbon 3D. When combining all of these negative factors, the stock is pricing in heavy competitive headwinds as investors are highly skeptical of a recovery in long-term fundamentals.