RKYMNT4,
Before I answer your question, let me disclose that I am NOT a chart watcher. I rely on others to do that type of thing. My background is in manufacturing processes and heavy industrial equipment.
Ok, here is what I see. CGFI's timing is not the greatest. They paid off the bond, on time, and then the same day filed the S-8 stating they were placing 5 billion shares (of the 15 billion Allocated shares, "A/S") into the compensation plan for employees. They also expanded the list of individuals eligible for those shares. They weren't too clear about it, and if you didn't dig into the past documents, or understand fully what they were saying, it looked like they were increasing the A/S by 5 billion shares. (that would require a SEC filing and I did not see anything of the kind when I searched the SEC web page)
People were panicking. A lot of comments like WTF! another 5 billion! That was wrong.
Some of the other resident gurus here postulated that the market makers saw a chance to grab large blocks of stocks that were on stop loss orders and pushed the stock to the 6's so they could pounce. But, like I say I'm not a chart watcher, so I can only take their word for it.
There is a saying in trading, "buy on rumor, sell on news". I think that's what we have here. MM's buying on the rumor of an increase in A/S, and they will sell when the real information hits, or news of the mill approval hits.
I'm holding my shares. I have seen the management work their butts off to get mill approval. We are so close to that end, and profitability. I do not think the management would work so hard for a scam. And by the way they work for shares, not cash. That means, if the mill doesn't open, or if the PPS drops to nothing, they have worked for years for nothing!
That's my take on it Rocky, I hope it helps. GLTY!
