Loon Energy Corporation (CVE:LNE) (PINK:LOONF) share price more than doubled on Thursday, completely out of the blue.
LNE share price went up 133% in a day on a heavy trading volume that topped 7.9 million. The number of shares traded during the session was 27 times the 90-day average amount of 289 thousand. This was the heaviest trading volume recorded for the past year.
Amid the trading day the company issued a press release stating the management was unaware of any material changes to have caused the price rally. There could be several shady reasons for such a sudden price jump. Among those is buying pressure caused by short squeezes, rumors on various message boards or energy sector related news.
The stock was down-trending since December 2010, had very little liquidity lately and was going down almost without corrections, which was attractive for bears. The stock price is currently back to where it dwelled since 2009 – below 10 cents, and that leaves plenty of space for natural volatility.
The only time LNE price managed to stay above this level was after the company inked a farm-in agreement with Petrodorado Energy Ltd. in October 2010. The deal allowed Petrodorado to acquire a 10% interest in Buganviles block.
