Gray Fox Petroleum Corp (OTCBB:GFOX) Comes Back With a Vengeance

The pump for Gray Fox Petroleum Corp (OTCBB:GFOX) is about two months old now and it’s fair to say that at the beginning, it didn’t look like the most successful campaign. Tobin Smith’s landing page and the excitement displayed by the newsletters did result in a couple of volume spikes at the end of November and during the first days of December, but, on the whole, the performance, especially considering the $270 thousand budget, left a lot to be desired.

Eventually, the enthusiasm died down a bit. The newsletters went quiet around December 10 and, predictably, GFOX found itself on a downward slope. The drop wasn’t as violent as the ones seen by other promoted tickers, but even so, the stock slipped from around $1.08 to $0.79 in about a month.

Over the last couple of days, however, it has displayed a remarkable recovery. As we mentioned in our previous article, it managed to jump back above the $1 per share mark on Tuesday and it’s been surging confidently ever since. Yesterday’s session was particularly interesting – GFOX went up by about 23% and closed the day at $1.42, but, perhaps more importantly, it managed to register a record-breaking $1.59 million in dollar volume.

Plenty of eyes are now fixed on the stock and quite a lot of money is at play.

Unfortunately, GFOX‘s surge is not due to an interesting press release or a good-looking financial statement. It is, in fact, caused by the pumpers who seem to be back all over the ticker once again.

The Stock Junction (TSJ) sent us the next in a long line of promotional emails a couple of hours before the start of yesterday’s session and it’s clear that it seems to be working. The email itself contains no new information whatsoever. Instead, TSJ have preferred to send us a word-for-word copy of the report written by Tobin Smith. There is one thing that is different from the previous alerts though – the disclaimer.

As we mentioned at the beginning of the article, GFOX‘s pump started off with a landing page which had a disclaimer saying that the total amount of money set aside for the promotion amounts to around $270 thousand. You can see from the fine print of yesterday’s email that the budget has apparently grown to exactly $389,561.10. There is another landing page (different from the first one) that also boasts the same figure. But what does that mean for the stock?

Well, it’s clear that the pump is far from over and, evidently, the ticker is capable of jumping up when there’s excitement going on around it. Early trading today, however, suggests that the peak this time might be extremely short-lived. GFOX started the session strong, but, about half an hour after the opening bell, it slipped and fell to around $1.23. It has since managed to recover some of the lost ground, but right now, about forty-five minutes into the session, it’s still in the red.

Ultimately, as we mentioned in our previous articles, the company has very little in terms of solid operations and financials to support the overinflated market cap (which hovers around $50 million). With that in mind, we won’t be surprised if we see the investors who received around 14 million shares of discounted stock start taking their profits. If they do it, the price will be in for a scary drop.

Which, by the way, is what happened to another heavily pumped penny stock. Endeavor IP Inc (OTCBB:ENIP) took a dive yesterday and wiped out around 14% of its value. It closed the session at $0.606 which is roughly 52% below the 52-week high reached during peak promotion.

That’s why, carefully weighing the risks and doing a lot of due diligence before putting any money on the line is, as always, absolutely essential.