In the last three trading sessions the promotional effects on Avatar Ventures Corp. (OTC:AVVC) seem to disappear. The share price is falling through the support levels and the trading volume are almost unnoticeable on the chart. Yesterday, AVVC lost more value after the promotions, even though the company tried to keep traders’ interest by promising more news. 
AVVC share price closed at $0.84, 15.15% below the closing price of the previous session. During the day the stock fell to 76 cents, meaning that if the fall continues below the next support at 65 cents AVVC may hit the bottom again. Although that looks like the worst-case scenario as there are some positive events that happened over the past week, it is also to consider that the company with a market cap of over $57 million looks too overvalued at present with its lastly reported $16 in cash and no other assets, not to speak of revenues.
Yesterday, the company announced in its regular press release that it has updated its corporate website to reflect the current features of the new products and services. This being not exactly the milestone news, the lack of reaction on the market was to be expected.
On the other hand, Avatar Ventures might actually intend to start building an asset base and a revenue steam. Last Friday, an 8-k confirmed that Avatar Ventures has entered into a binding letter of intent to acquire Apps Marketing Solutions, Inc. (“AMS”). According to the filing, AMS has some proprietary SMS technology and it develops mobile marketing applications for smart phones, tablets and other mobile devices.
That new business should have potential, though the final closing is yet to come. Both parties are still doing their due diligence and target closing date is set for May 30, 2011, with possible extension to June 15, 2011. In consideration for the acquisition, AVVC will issue 5 million shares of restricted common stock.
