Peter Hristov

Cyclone Power Technologies Inc. (PINK:CYPW) Keeps The Trading Range

by Peter Hristov August 2, 2011
2CYPW_chart.pngCyclone Power Technologies Inc. (PINK:CYPW, CYPW message board) closed the last session in a positive mood. CYPW finished the trading round 2.86% higher than the previous close at $0.36. Trading volume was more than two times higher than the daily average.

The positive trading sentiment was produced by a press release which was published the same day. It stated that CYPW had been awarded a contract, from the U.S. Army Tank Automotive Command, valued at $1.4 million.

The company will have to develop a compact 10kW auxiliary power unit to increase the operating efficiencies and decrease fuel usage of various ground combat vehicles.

After the news spread around, the market started to exert a buying pressure on CYPW stock which made the quote turn green in contrast to the general bearish session at the end of last week.

38CYPW_logo.jpgCYPW has just bounced back from the resistance at $0.4. The stock seemed naturally headed to the other border of the trading range before the press release changed things around. However, it is not certain whether CYPW will gather enough power to break the resistance.

The last quarterly report shows that the company has a working capital deficit of $2.5 million. This means than even a deal of the mentioned size will not help the company cope with its short term solvency problems.

In the first quarter of the year, CYPW has achieved a net cash inflow by issuance of common and preferred stock. However it appears that the market has been absorbing the issued shares without a major impact on the share price for now.

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