The trading volume of Holloman Energy Corp (PINK:HENC) yesterday bulged nearly 10 times over the daily average, on which a significant price surge was achieved. The stock hit a 21% gain and closed the session at $0.34.
In fact, HENC managed to break a resistance line at $0.27 before it pushed up. The strange thing here is that the spike occurred now when there are no news or recent reports. At the same time, the market remained frigid at the time when the last news was published.
In April HENC announced that it was encouraged by the drilling results on the two neighboring concessions. At that time investors accepted the news with indifference and the company continued to oscillate in the established range.
HENC is a company which is in the exploration stage of its operations. It searches for oil and gas in Australia. Compared with one year ago, the value of HENC stock has declined down from $0.6 to the current level, which is roughly 50% lower.
The reports of the company show that the accumulated loss during the exploration phase has exceeded $13 million, $3 million were provided by the issuance of common stock and another $2 million by discontinued operations.
On the whole, it is visible that the company will need to procure additional capital to sustain its oil and gas exploration – a fact that must not be neglected by investors. At present, investors must be aware that there is no clear explanation of the stock surge from yesterday and therefore it is not certain if HENC has made a convincing sign to leave the trading range.
