Shares of MongoDB, Inc. (NASDAQ:MDB) are up marginally on Wednesday. This follows Tuesday's selloff of almost 17%.

The stock found support around the $293 level. This isn't a coincidence. It's also why our team of technical analysts has made it our "Stock of the Day."

Third-quarter earnings announced on Monday were $1.16 per share, well ahead of estimates of 67 cents. Sales were $529 million, while analysts were looking for $498 million.

But sometimes headlines can be deceiving.

GAAP stands for Generally Accepted Accounting Principles. Sometimes, companies report their earnings on a non-GAAP basis.

For example, suppose a company had a factory burn down and incurred a $10 million loss. Because this is considered to be a one-time event, on a non-GAAP basis the company wouldn't deduct this from their earnings. On a GAAP basis, it would have to.

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On a GAAP basis, MongoDB actually had a loss of 13 cents a share. But because of a complicated accounting technique, the non-GAAP earnings were positive. The company added $1.75 to the earnings due to "expenses associated with stock-based compensation."

It isn't surprising that the stock fell and found support around the $293 level.

As you can see on the chart, this important level had previously been resistance. Resistance levels can convert into support, and that's the case here.

This occurs due to "seller's remorse."

Some of the traders and investors who sold shares around $293 came to regret their decision to do so when the resistance was broken in early November and the price moved higher. Many of them decided to buy their shares back if they could do so at the same price they sold them for.

As a result, when the stock fell back to around the $293 level these remorseful sellers placed buy orders. This large concentration of orders formed support at the price that had previously been resistance.

Sometimes, earnings headlines can be misleading. The 'Generally Accepted Accounting Principles' numbers may be very different than the Non-GAAP numbers the company reports.

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