Madalena Ventures Inc. (CVE:MVN) (PINK:MDLNF) stock price bounced support on Wednesday but still needs confirmation of whether it can hold at current levels.
MVN bounced up 7.4% under a strong trading volume of 6.5 million, which was three times the average of 2.12 million.
The price still remained in the downtrend and shorters are very likely to step up and attempt to use the situation for their advantage since there’s only technical reasoning behind this bounce. The price used a pretty vague support around 95 cents per share. The level also had a psychological value to it, as does the $1.00 per share, which the price now surpassed once again.
The price has been going down since the company announced $67.5 million bought deal financing in mid-February, 2012. The deal was closed on March 7.
The hesitation to push share price lower might relate to the company’s operational updates issued last week. Madalena said on March 15, their CAS X-2 exploration well on the Coiron Amargo Block has been cased as a potential oil discovery after reaching 3.5 thousand meters. The rig should soon be moved to drill two more wells in Sierras Blancas pools.
Even if the stock price is still reacting to the week old news, there is no telling whether it can go into consolidation around $1 per share. A large bounce up is very unlikely to happen, but chances for a consolidation period to kick in seem rather good.
