Borislav Tonev

Blue Fire Equipment Corp (OTCMKTS:BLFR) Steps Down Again

by Borislav Tonev September 13, 2013
1BLFR.pngThe paid pump for Blue Fire Equipment Corp (OTCMKTS:BLFR, BLFR message board) started on July 25 and although its effect was not as explosive as, for example, the one for United American Healthcare. (OTCMKTS:UAHC), the increased awareness and hype did lift the price to $0.80 per share within about ten days. Everyone was happy and there were a couple of opportunities for a profit for the wise investors.

At that price, however, BLFR's market cap was hovering around $27 million and it was clear that the ticker won't be able to withstand the pressure. Sure enough, the descend started but, once again, the corrections were not as violent as the ones witnessed from other pumped small cap ventures and instead of crashing down like a rock, it set a slow but steady course towards the bottom of the charts giving traders who got caught off guard plenty of time to escape the sinking ship.

By the beginning of September, the ticker leveled down a bit, the trading volumes dropped below 100 thousand shares per day and we thought that that will be the end of that. Yet, over the last couple of sessions, BLFR has been putting on an unusually erratic performance.

On Wednesday, more than 1.1 million shares changed hands which resulted in some roller coaster-like movement throughout the day. Eventually, BLFR closed the session 1.7% in the green and we figured that the intense trading must be due to the new purchase order that the company announced about an hour before the opening bell.

Yesterday's performance, however, is even more baffling. The ticker opened the session at $0.50, stayed there for a few minutes and started sliding down heavily. At one point, it reached an intraday low of $0.33 but by the end of the day it managed to regain some of its dignity, although it still finished the day at around $0.43 logging a daily loss of around 8.5%. All that on a volume of 1.2 million shares.

Today's session (or at least the first hour of it) appears to be much calmer with the price hardly moving and trading that seems to be nowhere near as intense as the one witnessed yesterday. But what we're interested in finding out is the reason for the frantic buying and selling during Thursday's session. Unfortunately, there seems to be no cause that is immediately obvious.

The newsletters stopped sending in alerts quite a while ago, there have been no new filings since the end of August and while the promotional landing page set up by the touting crew is still up and running, we can't see how it alone will manage to generate that much interest in a single day.

In fact, the only obvious thing that could push the price down is the sale of quite a lot of stock. As we mentioned in our first article on BLFR, there is no shortage of people who own some shares - a private placement was carried out back in 2012 in which a few investors bought 7.5 million pre-split (15 million post-split) shares for just $75 thousand.

In yesterday's coverage, we mentioned the names of the people who took part in the placement - Go Solar USA, Inc. (OTCMKTS:GSLO)'s former CEO, Mr. Tyson Rohde and his family. When you have in mind how shady his former company was, we can't help but have our doubts about BLFR's own stock performance.

4BLFR_logo.jpgOther than that, the news seems good. As we mentioned, a purchase deal was signed recently and according to the management team, the partnership might be extended further into the future. In addition to this, a new press release from today announces some developments around their latest patent application.

Bear in mind, however, that, especially in Pennyland, the developments around the business are not always indicative of the movement of the stock, which is why weighing all the risks carefully is absolutely crucial.

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