Arch Therapeutics Inc (OTCBB:ARTH) Tanks As The Promotional Budget Grows
On Thursday around 3 million shares of Arch Therapeutics Inc (OTCBB:ARTH)’s common stock changed hands which means that the dollar volume registered for the day was around $2.02 million. On Friday the number of shares traded was a fraction bigger but the trade value remained pretty much the same. On the face of it, two identical sessions… with the exception of the price movement. While ARTH managed to add around 20% to its value on Thursday, it failed to end the week on a positive note and on Friday, it registered around 14% in losses.
The ticker looked like it was poised for a strong session when the opening bid hovered around $0.70 which is above Thursday’s close. It managed to remain relatively steady for about half an hour but it then logged a scary drop reaching $0.63 in just a few minutes. There was another slide around 11:00 AM but as the day pressed on, ARTH managed to regain some composure and when the closing bell went off, it was standing at $0.58.
The next logical question is: “Was there any immediately apparent reason for this?”. The answer is “No”. Then again, there’s been nothing immediately apparent to push the price up during the five sessions prior to Friday’s fall. Apart from, that is, the rather big promotional campaign that’s entering its third week today. And unlike ARTH themselves who can’t be bothered to publish a press release giving us any significant information, the pumpers are quick to reflect any changes around their latest expensive promotion.
The news there is that the budget has grown. If you take a look at the fine print on the landing page that was specifically designed to entice you into buying some ARTH shares, you will see that according to it, the third party paying for the whole show (Advantage Media Corp) has already shed around $854 thousand on the pump and they are expected to pay a further $350 thousand which means that the total budget now amounts to exactly $1,204,960 whereas a week ago it was no more than $790 thousand. The brochures flying around the snail mail on the other hand, are saying (again, in an annoyingly fine print) that Advantage Media paid more than $2.9 million for ARTH‘s promotion. This makes things all the more confusing and we can’t really be sure which of the numbers is the one closest to the truth.
Whatever the case, Advantage Media (or whoever is standing behind it) paid a substantial amount of money and that in turn means that they are bound to getting some of the investment (if not all of it) back. How can they do it? Well, the first thing that comes to mind is the tried and tested method of selling some stock when the price is high. This could explain to some extent the drop that ARTH experienced between July 9 and July 18 when in a matter of seven trading sessions, people’s investments were crushed while the ticker was plummeting from a high of $1.30 all the way down to $0.45.
You can read from our articles from last week that ARTH made an effort to regains some of the losses, but as you can see an invisible force stopped it on Friday and it booked the ticker a place among the biggest daily losers along with Sanborn Resources Ltd (OTCBB:SANB) and Xumanii, Inc. f/k/a Medora Corp (OTCMKTS:XUII).
Yet, right now, just an hour into the session, we can see that the ticker might be making a comeback since, although the trading volume suggests that we’re in for another interesting day, it has yet to fall below yesterday’s close.
And that really is the biggest problem with ARTH at the moment. A long-term investment is pretty much out of the question since we’ve already seen that the odds of the company making it big time aren’t brilliant (considering the management team’s efforts with other pharmaceutical penny stocks). As for taking advantage of the pump and making a quick and easy profit, we reckon that the stock’s behavior is far too unpredictable and the sudden climbs followed by scary drops turns a risky play into a downright dangerous one. That’s why treading extremely carefully and avoiding any investments unless you can afford the losses should be your best bet when it comes to ARTH.
