Red Giant Entertainment, Inc. (OTCMKTS:REDG) Thunders Back Down to Double Zeroes

The latest run of Red Giant Entertainment, Inc. (OTCMKTS:REDG) seems to have come to its unavoidable end, as the ticker crashed 41% in a single session, now down 55% from the high it managed. After a couple of lighter-volume sessions last week, selling intensified and nearly 200 million shares changed hands as REDG slipped on Friday.

Looking at REDG‘s chart, it’s almost like history is repeating itself. The original pump job targeting REDG in early 2013 is now absent but the price movement is almost the same, with an artificially created spike and a quick retrace. While in early March 2013 REDG was targeted by a $500,000 pump campaign conducted primarily by promoters Victory Mark, this time around the spike took place without pump emails.

With no recent news releases and the stock just hitting $0.0009 per share immediately before the surge, there was no organic cause for the sudden price hike. However, a certain ‘investor group’ using Twitter to highlight stocks seems to have taken a sudden interest in REDG despite being usually focused on pot stocks and appears to be the cause for the tremors. Technically, this sort of thing is not too different from promotions as it creates hype and inflates prices without the inconveniences of managing mailing lists and writing up disclaimers. Obviously, REDG is aware of this as well, as the company mentions said ‘investment groups’ in a press release, stressing that it has not ‘solicited nor paid for any promotion’.

Ultimately, the chart movement seen since the surge does look very much like that caused by pumps, with sudden wild appreciation and then a rapid decline. No doubt, the people who are well aware why exactly ‘investor groups’ tweet about microcap stocks managed to get in and out and play the alert but there are probably also many others who got in late and are now looking at significant losses. Doing your own due diligence on any given stock you plan to invest in is a must, even if there are some seemingly knowledgeable people on the Internet who are willing to hand you free recommendations, as those are not too different from conventional stock pumpers.