Chinese commodity trading services company TD Holdings, Inc. (NASDAQ: GLG) stock went parabolic Friday after announcing its plans to acquire two different companies simultaneously.
Shares were up as much as 42% following the news … so what’s really going on with GLG?
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TD Holdings Plans Double-Acquisition
In a press release, the company said it has entered into a non-binding letter of intent with Guangdong Jinbochuang Special Purpose Vehicle Co., Ltd and Hunan Jinmeike New Material Co., Ltd. to acquire 100% of both companies.
Regarding the dual purchases, CEO Renmei Ouyang said “over the past decade, we mainly focused on large-scale business transactions including non-ferrous metals trading and supply chain services which are inseparable from warehousing and logistics. The planned acquisition of Jinbochuang and Jinmeike is not only in line with our growth strategy of improving our industrial chain, but also corresponds to the national strategy of ‘Made in China 2025’ and the industry trend of manufacturing lightweight vehicles.”
GLG Stock: The Reaction
Traders enthusiastically applauded the announcement as GLG stock was up more than 20% pre-market and continued to rally through the early hours of trading.
But what goes up, must come down. If you know what to watch for, penny stock chart patterns are incredibly predictable. At writing, GLG stock had faded off its intraday high of $1.32 and was hovering around the $1 level.
Bottom Line: Should You Trade GLG Stock?
With the excitement building, you’re probably wondering: should you trade GLG stock?
That’s a decision you must make for yourself. While there’s no predicting how far high-flying penny stocks can run, there’s also no telling how low they can plummet after the initial hysteria has passed.
When it comes to trading GLG stock, make sure to be disciplined and do what works for you.
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