Its the convertible bonds from the financing. The accumulation curve shot up, showing the conversion of the bonds into actual shares. But then it appears that they sold those shares immediately.
I also do not like that they were converted and sold so quickly, however that is a good way to scare new investors off: have a steep decline in the price due to a sell off, pay some bashers to go out on the message boards and make up lies (now-now-child on yahoo is the poster child pro-basher) that distort the truth about why the price decreased, and make a scared market to even further drive the price down... and thus geta cheaper price on the further conversions! Its brialliant, from teh convertible bond holder's point of view. However it does not mean that all of the shares will be sold once they are converted. Certainly some should be held on to. Nonetheless, the company's strategy will be to attempt to balance out these effects by rapidly announcing good news, to try to keep the price up but also to report on the use of the money it just received.
The good news is still good, but there is a flood of shares coming does nthat waters down the base. Like I said before , I am not thrilled about the terms of the financing, but sometimes these conversions are the only way to get cash to keep the company moving. Esp. in a tough credit market.
the upside here is that there is good news, and the stock can recover if they use the newfound money wisely and get some gold ingots sold on the market ASAP. Produce a couple of those, and the investment money will flood in like crazy.
I have been saying all along that I felt that October was the critical time, the critical month, and I am sticking to that. We must see some serious progress by the end of October or else she might not make the cut.
But I still believe it will happen. I like Mike. I think he will pull this off.
Bottom line: the downward price movements are natural because the share pool is growing. However, with that comes new risks: how many shares will be converted thus reducing the existing value?
I personally beleive that Gemini is sitting on good properties and that conversion events for 600K worth of shares is not critical, and that its a good opportunity to acquire more shares. If the financiers did not trust the company's ability to make money, they would not have opted for convertible bonds but for straight interest.
The problem here is that Gemini needs broader attention. Mike Hill should be trying desperately to get Gemini listed in some of the mining journals, jet getting a mention in some of those will seriously broaden the potential share holders. As for now, there are only a few of us who hold shares in this . With the expansion in shares, we need mroe peopel to get interested in absorbing the shares.
Anyway, that is the long answer as to why the price is going down despite awesome news. Its more risk, but also a good buying opportunity. High risks could be high rewards... alternatively it could mean losing your investment.
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