The Pump For Arch Therapeutics Inc (OTCBB:ARTH) Is Really Heating Up

As we wrote yesterday, we needed to wait more than two weeks for the promotion on Arch Therapeutics Inc (OTCBB:ARTH) to start. At one point we were even wondering if the pumpers hadn’t decided to ditch their plans and move on to another penny stock venture with doubtful future. In the end, though, the landing page that we talked about for so long went live and everyone was mightily excited.

So much so, in fact that yesterday’s session broke a couple of records. The ticker opened at $1.08 which is way above Friday’s close and what happened next can only be described as a frenzy. By the end of the session it was standing at $1.24 and it hit an intraday high of $1.29 which is value never before experienced by this particular stock. More than 2,000 trades were registered and the total volume amounts to a mind-bending 7 million shares. At more than $9.4 million, the dollar volume is just as impressive and it ranks ARTH among the most heavily traded companies from yesterday. But was it only the landing page that created all the excitement?

Of course not. While we were writing yesterday’s article, the emails were just starting to arrive in our inbox and now we can do a recap of the mailing activity, as well. It wasn’t that big but some influential pumpers took place. The first email came from The Stock Junction who basically copied the landing page with its overly optimistic price targets and they weren’t even bothered to edit the disclaimer out. The compensation disclosed is $3,000. The promoters who probably got more attention from the traders are Five Star Equity and Paragon Report, who are both owned by an entity called Providence Media Strategies LLC. Providence admitted that they’ve received $200 thousand for the campaign and this is something of a comeback since the last time we heard from them was back in March. They were probably too busy spending the $75 thousand compensation that they received for the promotion on Echo Automotive Inc (OTCBB:ECAU). Speaking of which, on the right you can see what sort of mess they made with that particular campaign and for those of you who are interested in the numbers, we should say that some of the traders who decided to play this particular pump are looking at losses of around 88%.

In addition to Providence’s efforts, however, there was also a hard-mailer campaign for ECAU and it was only normal to have a look and see if we will be able to find something similar for ARTH. After rummaging around the message boards and social networks, we stumbled upon some photos of such a brochure. It’s the same affair that we’ve seen over and over again – pretty pictures, colorful diagrams and a lot of ridiculous price targets. It is very similar to the “report” that we see on the landing page, but we can see some changes in the wording. While the web-version says that Ian Cooper is “recommending ARTH as an immediate and aggressive buy” in the paper version, he is “urging” us to do it despite all the red flags that he deliberately fails to mention. There is one more difference between the virtual and the paper version, of course – the compensation. While the landing page still speaks about a $790 thousand budget, the brochure states that it amounts to no less than $2,926,550. If you have a look at our article from yesterday, you will see that we were expecting this to happen and we won’t be at all surprised if the total compensation grows even further.

In any case, these are all details. What’s really important is the fact that there’s now a full-on promotional campaign and the pumpers seem to be employing all they have in their arsenal. All the artificial hype will probably keep the stock high up in the air, but there’s no telling when it will all come crashing down. That is why even if you decide that you want to play the pump, you should make sure to tread carefully and time every move very well.

If you don’t, you might end up getting horribly burnt like the people who blindly trusted the paid promoters when they were starting their efforts on Northumberland Resources Inc (OTCMKTS:NHUR). As you can see from the chart on the right, the total losses since the high of the pump amount to no less than 64%.