Nikolay Tomov
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New Financing Boosted the Shares of Compliance Energy Corp. Stock (CVE:CEC), (PINK:CPYCF)

by Nikolay Tomov Mar 17, 2011
Needless to say, there is no way you can do business without money. You might be a brilliant manager, have wonderful ideas, hire excellent employees, but this will just not be enough. If you do not have sufficient capital in your hands, you may end up achieving nothing.

Compliance_-_Chart.pngThis is what managers of Compliance Energy Corp. (CVE:CEC), (PINK:CPYCF) seem to know very well. Over the last days, they have been quite busy trying to secure additional funds for the company.

A week ago, Compliance announced a $3.5M financing that was comprised of two placements: a flow-through financing for gross proceeds of $1.25M; and a $2.25M non-flow-through financing. In the days that followed, the company informed about having closed the two portions of the placements.

As expected, the financing news had a positive effect on the stock performance. In a week, CEC went over 18% up, closing yesterday at $0.39. The turnover of 712K shares was well above the company's average.

These funds come just in time for the company. In the end of last September, it had reported only $860K of cash, together with a net loss of $237K for the third quarter of 2010.

Now, with the new financing, things look much better indeed. Still, it is not clear for how long the surge of the stock will continue.

From a technical point of view, the last two candlesticks formed a pattern that resembles a bearish Doji star. It suggests a potential decline in the share price, but this requires confirmation.

Compliance_-_Logo_2.pngDuring the last session only, an inverted umbrella was formed - this might mean a possible bearish reversal sign too. However, its reliability is not very high and needs confirmation too.

Regardless what technical analysis says, the company continues its efforts to impress investors and support its shares on the markets. Several days ago, Compliance took part in the annual conference of Prospectors and Developers Association of Canada that was held in Toronto.

Regardless of the technical analysis, CEC opened today's session higher than yesterday - at $0.41 per share.

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