NUGL Inc (OTCMKTS:NUGL) Is Doomed As Stock Tanks

Shares of NUGL Inc (OTCMKTS:NUGL) are edging lower following the formation of a double top that indicates bulls are slowly losing the fight against bears. The stock has already breached a critical support level, as the emerging downtrend continues to gather pace.

NUGL Share Price Analysis

Wild swings have turned out to be the order of the day even on NUGL starting the year on a roll. The stock started the year at the $1.87 level, followed by a plunge to the $1.20 level. The stock did bottom out and consequently rallied to this year highs of $2.40. NUGL Daily ChartThe Rally was short-lived, as the stock has once again come down tumbling. A violation of the critical $1.87 support level might as well have provided early signs that the stock is headed lower, in continuation of the emerging bear trend.With short sellers, regaining control NUGL could as well be headed to this year lows of $1.20. A spike in short selling pressure comes even on the company achieving significant milestones on the development of a search tool as well as a social media platform.

About NUGL

NUGL operates a first of its kind cannabis search app designed to provide all information related to cannabis. The app just like Google provides search results on whichever queries one might have on various topics touching on cannabis. The search tool includes search results for user-rated dispensaries as well as strains, doctors and cannabis service providers.

Recent Developments

Shares of NUGL have continued to edge lower even on the company announcing plans to debut its social media platform at the LA forum. NUGL 2.0 is the company’s latest social media platform designed to ensure connections in the cannabis sector.The company intends to use the new platform to compete with all existing social media platforms.

“We are really happy with the feedback on the latest version of our software. We believe we have finally filled the void between social media and the cannabis marketplace and are excited for the future of our community,” stated Ryan Bartlette, CMO of NUGL.

In addition to the unveiling of the new social media platform, the company has also inked a promotional partnership with National Cannabis Industry Association. According to the company’s CEO, working with NCIS is a natural fit for NUGL and its media outlets, as part of an effort of helping businesses grow in the cannabis space.

“Together, we will be able to leverage our consumer and business traffic and reach to help promote the cannabis community as well as advance NCIA’s efforts to progress the cannabis industry and NUGL Inc. as a whole," said Mr. Barletta.

Tech Giants Competition

NUGL has embarked on an ambitious plan to become the go-to place for any information related to cannabis. The launch of a social media platform, as well as search engine, underscores the company’s drive for market share as part of its growth strategy.However, the company faces an uphill task to become the go-to shop for all things cannabis. As it stands, the company faces stiff competition from other companies offering similar services. Google remains the undisputed king of search that even other tech giants have struggled to compete against.As it stands, Google remains the go-to place for any information on the web. It is highly unlikely that people would shun the search giant just to log into NUGL search tool to carry out cannabis queries.While there is also the argument that NUGL needs only a small percentage of the search market to be successful, the company still faces a lot of competition from other search tools, such as Bing. In addition, it is unclear the amount of search market share the company will need to amass to generate to turn in some profits.When it comes to social media connections, the company would also struggle to dethrone other well-established social networking platforms that cannabis enthusiasts are already using. The Facebook and Twitter of this world control a substantial amount of market share when it comes to social connections.In addition, the tech giants that NUGL is competing against are backed by solid balance sheets that they would be more than willing to use to curtail any competition that NUGL poses.That said NUGL faces an uphill task on its bid to be the go-to place for everything cannabis. Recent price action activity suggests waning investor confidence about the company’s long-term prospects.With a current market cap of $80 million, NUGL looks like an overvalued situation given the headwinds the company faces.We will be updating our subscribers as soon as we know more. For the latest updates on NUGL, sign up below!Disclosure: We have no position in NUGL and have not been compensated for this article.Image courtesy of Pexels