C&D Technologies, Inc. (PINK:CHHP) stock price recently bounced up to a new high for the period the stock has been trading on the Pink Sheets. It retraced back down shortly afterwards, showing how fragile the appreciation is.Currently, the price has started to consolidate around 23 cents and a noticeable drop in liquidity is pointing to a possible price collapse. If profit taking kicks in without proper supply, the stock could roll back down to 15 cents in no time.
The company recently converted the majority of its debt, which was the key trigger for preceding price appreciation. It poses significant threat of dilution, stock price manipulation and sudden price collapses if the issued common stock hits the market.[BANNER]
Price appreciation attracts only limited volume, showing no strong conviction for further gains. The spikes occur only on break of resistances, thus on the further move can be speculated. The price failed to stay above the resistance at 25 cents. This level also has mental appeal to it and the price had consolidated around it in the past.
Even though the company is one of the more financially sound penny stocks, the performance clearly doesn’t allow to maintain higher market value and recent management actions, through debt conversion, have almost assured further stock price depreciation. Things could only revert on sound material news, which hasn’t happened yet.
