Takara Resources Inc (CVE:TKK) is holding the gains after the share price spiked up for no apparent reason on Monday.
Trading volume remains more active than usual today, with not so much price action though. There was no official news that could trigger the sudden buying wave. The company didn’t comment on the strange activity of the stock as well.
Technically the stock bounced the support at 20 cents. This level helped to sustain the uptrend around 6 months ago. Short squeezes could have helped to move the price up for the most part during this rally. However, intraday chart shows the move was very quick, and profit takers sold right after the initial explosion. The price is now holding near the historical resistance at 28 cents per share.
Since no official news were out, the stability of this price level remains questionable. The last positive news that moved the stock came out in mid-January, when the company secured $4.35 million private placement. The stock’s been rolling down since.
The current rally should be expected to be followed up by a gradual correction. Historical data shows that TKK is prone of sudden rallies, but was never able to sustain a steady uptrend.
Takara Resources is a mineral exploration company with uranium properties in Arizona and Ontario, gold properties in Quebec and British Columbia and nickel sulphide prospect in Manitoba.
