Cannasys Inc (OTCMKTS:MJTK) shares started to move higher in January and volume began to creep up. This often sets off trading algo’s where computerized market makers do not care what the company does. These Bots try to capture trends by buying into strength and selling into weakness. These are the ultimate unemotional machines trading stocks where they don’t consider any fundamental aspect of the company, they are simply a computer program that recognizes a trend and spring into action when a volume threshold is reached. Normally these are easy to spot because they leave a footprint in the share traded ledger anyone can spot if they do a little digging.
On January 26, 2017 the stock began a rally which lasted for almost a month. However, it is doubtful that Cannasys can replicate such a response from investors, with a single update, once again.
It should be noted that since January 26, Cannasys Inc (OTCMKTS:MJTK) has made a few filings with the SEC, none of which seems to have generated a positive effect on the stock. These fundamental filings are irrelevant to the Bot Algo traders, they do not consider the filings, they simply see that shares are going higher and volume has ticked up.
For those who do follow fundamentals a recent 8-K filing with distributed earlier this month, the company made certain amendments to its equity purchase agreement, originally signed on December 15, 2015. The agreement was signed between Kodiak Capital LLC and Cannasys. Under the amended terms of the agreement, the two entities have decided to increase the maximum commitment amount to $3 million, while the commitment period would also be extended to December 31, 2018.
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The amendments came almost a month after MJTK revealed in an SEC filing that it has exercised its right under the equity purchase agreement and issued 36 million shares of its common stock, to Kodiak, for gross proceeds of $148,680. The sale was conducted on February 2, 2017. Kodiak Capital reserves the right to sell these shares under a registration statement, as it pleases. In the filing, the company further revealed that a total of 100,000 shares were also issued to Patrick G. Burke, in lieu of consultation services received. Moreover, during the same month, approximately 118 million shares were also converted by two investors, from promissory notes. This action created the price action and volatility that caused the Bot to discover the trading action and prompted the portfolio manager to take action during MJTK’s promising rally.
Know that as of January 2017 much of the fundamental action was driven by the news that Cannasys has eliminated 90% of its aged debt. Added to this, the company has also retired approximately $140,000 of its note payable, as well. The move resulted in a stronger balance sheet for the company and brought the attention of new shareholders wanting to participate in the Cannabis sector. This type of activity where you have the 3 pillars of participation revolves around a fundamental event, a strong sector rotation into these shares and the arrival of algorithmic trading Bot.
It is a cool phenomena to observe and normally it brings a flurry of activity followed by a market awareness not previously present in the stock. This is ultimately good for the common shareholder which is the case for Cannasys Inc (OTCMKTS:MJTK) as the 3 horseman arrive on the scene to participate in shares moving up and down. What to watch is the sentiment for the Cannabis sector itself, and observe how it divides itself into the forming sub-sectors in Cannabis. This is an ongoing story which will last more than a decade as we are in the first inning of the contest. For continuing coverage on shares of $MJTK stock, as well as our other hot stock picks, sign up for our free newsletter today and get our next hot stock pick!