Deals website Groupon Inc (NASDAQ:GRPN) is on the precipice. After falling to a low of $2.15 a share earlier in the year — down 93% from its ebullient post-IPO high in late 2011 — GRPN stock is trying to claw its way back.

As shown in the chart below, the $4-dollar-a-share level is critical uptrend support going back to the February low. The cautious rise, which has seen GRPN shares triple into their August high, has been predicated on turnaround hopes.

But are those hopes misplaced? And is Groupon stock vulnerable to a downside move to summertime support near $3?

The late October selloff in GRPN stock came after the report of solid Q3 results — with a top-line and bottom-line beat — as well as raised guidance. Doubts remain on the acquisition of LivingSocial, with Groupon announcing it plans to acquire all outstanding shares. Cross billing was also down 2% to $1.4 billion.

A Couple Bullish Points on GRPN Stock

I see upside from here, however.

North America gross billings were up 6% last quarter thanks to new active customers. North American units were up 4%. The rest of world remains a challenge, admittedly, as the company focuses on streamlining its operations and exiting underperforming countries (focusing on 15 by next year vs. 47 at the beginning of 2015).

Still, Wedbush analysts upgraded the stock on Oct. 17 on accelerating website traffic growth and improving deal inventory as well as attractive valuations.

The next catalyst for GRPN stock likely will be Groupon’s earnings report on Feb. 9. Analysts are looking for earnings of 3 cents per share on revenues of $916.1 million.

Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.