Shares of Tower Resources PLC (LON: TRP) plunged 11.1% as they pulled back following the recent 4-day rally that started on July 29 and saw its shares rally over 90%.
The independent oil and gas company with operations in several African countries did not make any significant announcements in the last few days expects for an RNS release detailing the total voting rights in the company.
The lack of an apparent fundamental reason behind the recent rally indicates that it could have been driven by a prominent investor accumulating a significant position in the company. However, the rally could also have been driven by other market factors.
Tower Resources last major announcement was in June when it raised £50,000 from its current chairman and CEO, Jeremy Asher, via a public share subscription.
Many of the company’s followers have been waiting for a joint venture that would allow the firm to partner with a more prominent player with adequate resources to help it explore and potentially kick off production at its various projects.
Tower Resources has projects in Cameroon, Namibia, South Africa and Western Sahara with significant production potential. However, the firm still has to develop these resources into oil-producing assets that can generate revenues.
The June capital raise was a stop-gap measure as the oil exploration company waits to secure funding from other sources putting significant pressure on its shares. The stock bottomed soon afterwards and traded sideways before the recent rally phase.
Investors who missed the recent rally could get a better entry in the coming days once the pullback is complete, given that Tower Resources shares have formed a parabolic shape, which is typically followed by a significant pullback.
*This is not investment advice.
Tower Resources share price.
Tower Resources shares fell 11.11% to trade at 0.48p, falling from Monday’s closing price of 0.54p.
