1st Global Financial (PINK:FGBF
) stock price looks ready to return to its original dwelling grounds after a short burst resulted in a 1900% price increase in just two days last week.
Friday's trading session recorded the heaviest volume for the year, as well as a new 52-week high. The chart, however, already points to extensive profit taking and the next couple of sessions are very likely to see the price dropping.
The vaguely traded pink sheets stock got huge attention after the company announced they will be merging with World Corporate Assets Inc. The news wasn't available on any large PR news site, thus causing the delay between the announcement and the explosive wave of trading.
The company should be consulting their legal advisors right now, but no guidelines for the official filling were yet announced. If the merger is completed, the non-reporting shell company will finally get a business model, which would make the stock price break out into the blue sky territory.
However, in the meantime speculations are the driving factor and Friday's price and volume behavior shows that the buying pressure is already fading off. Shorting this kind of stock is rather challenging due to liquidity issues, even though the next couple of sessions will likely see depreciation in the price.