Medical Marijuana, Inc. (PINK:MJNA) Surfacing from a Red Week
Over the last few trading sessions Medical Marijuana, Inc. (PINK:MJNA) slipped day after day. There were no disturbingly sharp slumps, but the stock kept inching down on the charts day after day, logging five consecutive red days.
Even though both price action and share volume faded over the last two sessions, MJNA still closed down, losing 5 cents or about 16% from its last green close. The decline, while hardly disturbing or signaling a strong downtrend, is not a pleasant sight for shareholders.
Traders on discussion boards are busily tossing chart analyses and estimations at each other, often posting completely contradictory opinions, some claiming the charts scream ‘buy’, others marking them up to show it’s a definite ‘sell’. How relevant such analysis attempts are for a penny stock, even one that has gained a lot of exposure through its business and not through pumps, is a different question. The sector tends to trade on hype, as the price movement of March 20 showed, coinciding with the day MJNA announced its plans for expansion in Europe. Twenty-five cents per share may turn out to be more of a psychological barrier than a technical analysis level.
Last week saw some newcomers to the field of medical marijuana trade heavily and crash just as hard, namely heavily promoted Creative Edge Nutrition, Inc. (PINK:FITX) and SK3 Group, Inc. (PINK:SKTO). It seems that companies who have a better foothold in the sector have little to fear from new entrants, especially when such entrants are aided by pumps. Despite the large volumes, both companies cooled down quickly and are a long way behind MJNA in terms of market cap.
With some traders expressing their disappointment with the indefinite delay in U.S. attorney general Eric Holder’s final stance on the matter medical cannabis, and others, rather naively, suggesting MJNA will wait for April 20 to break out its next big batch of news, shareholders are left hoping the stock will manage to pull itself out of the minor stall it got into and take off from $.25.
