In the last three trading sessions the stock of Empire Post Media, Inc. (OTC:EMPM) formed a bullish pattern on the chart with two consecutive gaps up at market open and a positive change in the closing price. The reasons behind this performance are crystal clear – news and promotions.
Monday session closed again with an 8.62% jump of EMPM share price at $0.315. Although yesterday the trading volume was huge as well with 780,000 traded shares, RSI shows that EMPM is still in oversold area. Friday session was set also a resistance level at $0.4, and marked the start of the strong promotional campaign for EMPM which came along with the announcement of the latest news from the company.
According to our database, $60,000 have been spent on the promotions for EMPM in just two days, the latest e-mails coming yesterday. Two different websites have participated in the campaign so far and an unknown third party has paid for the promotions.
As mentioned, on Friday last week Empire Post Media announced in a press release what is actually a fact since August 4, 2011 (according to an 8-K filing of the company from September 1): EMPM has acquired Hybrid Reality Entertainment, Inc., a creator, developer and producer of television programming.
The acquisition has been paid with 3 million restricted shares of EMPM and another 7 million shares shall be issued when Hybrid starts the production of its new series called “Journey Beyond”, which is currently scheduled to begin this month. The news from yesterday was that Hybrid has entered into a worldwide distribution agreement for the new series with The Freemantle Corporation. There is still no SEC filing to confirm the deal.
Another problem arises from the 8-K filing from the beginning of September which says that EMPM has agreed to provide the financing for the first year of Hybrid’s new series (called in the 8-K just “The Series”). Considering that EMPM had only $5,241 in cash at the end of May this year, and that management plans are to raise additional capital through the sale of stock, it looks like shareholders should expect more dilution.
