Replenish Nutrients, formerly known as EarthRenew, had a monster rally day on August 23rd 2022. The company which is scaling up production of their regenerative fertilizers exactly when the world needs it, closed the trading day just up over 19% on the 23rd of August.

Large percentage moves should be accompanied with large volume for a better chance of sustained momentum. Replenish Nutrients definitely meets this criteria. The stock on average sees a volume of  447,369 shares traded. The double digit rally day saw a volume of 2,742,915 or about 5x the average volume! The last time more shares were traded was on March 31st 2022.

What was the catalyst? There was no news from Replenish Nutrients so it wasn’t press release driven. Agricultural commodities had a nice day, and so did agriculture in general, so it could be long term investors seeing the value here with Replenish Nutrients at these cheap levels. With the amount of volume traded, perhaps big news is on the way? I like to attribute this move to the technicals. Technicals which looked better with the move in agriculture and agricultural commodities.

Oh there is one more thing. Equity Guru featured Replenish Nutrients on August 22nd and 23rd. Lukas Kane discussed the fundamentals and revenue surge. We also had interviews with CEO Keith Driver:

I outlined the technical case and why the chart looked prime for a reversal. This was the chart that readers were given on the 22nd:

This is the current chart:

A few key points.

Firstly, we are now testing the major $0.20 resistance zone. Once we close above $0.20, this stock is ready for take off. All our reversal criteria will be met.

Secondly, the close above $0.17 is a huge step in the right direction. From a technical case, the price action on the 23rd saw the stock close above near term $0.17 resistance and close above my moving average. All of this happening near major support just adds to the likelihood of a major reversal and a new uptrend.

So what next? $0.20 is a key zone which we want to see break. However, the stock could have a relief or pullback. A 19% pop would see some people take their profits the day after. Pullbacks are normal after a breakout. I can see the stock pulling back to $0.17 before running again. This provides an opportunity for those who missed out to jump in. We must hold above $0.17. If bulls do not hold this one, then the momentum sways back in favor of the bears.

In summary, the technicals are playing out as I have analyzed. We expect this from good setups. The fundamental case remains strong with Replenish Nutrients expanding production and the world needing more fertilizers. The recent moves in agricultural commodities and agriculture stocks also will buoy Replenish Nutrients to higher prices.