Hristina Beeva

El Capitan Precious Metals, Inc. (OTCBB:ECPN) Rebounces on New Week

by Hristina Beeva November 26, 2013
Monday came with a wild rebounce for El Capitan Precious Metals, Inc. (OTCBB:ECPN, ECPN message board), trying hard to reverse the red streak from past week. ECPN started off with high hopes despite the lack of a promotion, but the PR noise only had a temporary effect. ECPN added more than 40% to 18 cents, on dollar volumes of above $295,000. Investors' forums remain quiet around this ticker, as it is an obscure bid that in the past month created and destroyed quite a bit of investments. ECPN1126.png

ECPN mostly relies on studies and preliminary assays to convince investors of the viability of its El Capitan project in New Mexico. Unfortunately, ECPN created expectations for more material news and developments- but lost the loyalty, leading to last week's drop. Now, the ticker will have to show if the rebounce will last for a while, at least during the week shortened by holidays. NVGC1126.png

ECPN is also disappointing as it slows down its latest 10-Q form, even beyond the announced delay of 14 days. This may further test the loyalty of investors, and be a vehicle for negative news as ECPN shows it has been digging itself into debt for a while. The previous report shows:

  • cash: $245 thousand
  • current assets: $376 thousand
  • current liabilities: $161 thousand
  • no revenue since inception
  • quarterly net loss: $355 thousand
  • accumulated deficit: $201 million

All of this does not bode well for gold production. And ECPN comes in at a moment when gold companies are enjoying a small revival. Nevada Gold Corp. (OTCBB:NVGC) is a recent mover that is on a general upward run. Though Friday came in with a significant correction, NVGC recovered on Monday's buying to stand again at 40 cents and perhaps try out new heights.

OriginOil, Inc. (OTCMKTS:OOIL), a former high-flying promotion, also made an unusual move on the first day of the week, growing on sudden buying interest by more than 22% to 27 cents. This ticker offers a choppy ride with wild daily swings, but has hardly fulfilled the promises of oil production and sales.

If you are still attracted to ECPN, also keep in mind the red flag of a lawsuit for gathering and misapplying funds from investors. While this may not have immediate effect on the stock price, it is still an indicator of the reliability of this ticker.

ECPN has shown the possibility for big drops, so it is best not to rely too much on the next positive trend.

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