A look back at consumer habits shows a growing trend by younger generations, from Millennials forward, towards environmentally friendly and natural cleaning products. Moreover, those still under 40 years of age are far more conscious about image and corporate transparency and responsibility than the people before them. That all plays well for a public entity like Softlab9 Technologies Inc. (CSE:SOFT) (OTC:SOFSF) and its target acquisition CleanGo GreenGo Inc.
CleanGo GreenGo is an FDA and Health Canada approved manufacturer of green, non-toxic, and biodegradable suite of cleaning products for industrial, commercial and consumer markets. Against the backdrop of the COVID-19 pandemic, CleanGo GreenGo has recently launched a line of hand sanitizer, which aligns with its portfolio of products that are lab-tested to defend against the novel coronavirus, including a new fogging service for disinfecting heavily trafficked areas.
More broadly, Softlab9 in August forged agreements that mark the company’s expansion into distribution of COVID-19 rapid tests and personal protection equipment (PPE), such as masks, coveralls and gowns.
Investors have reacted positively to the acquisition and diversification as measured by the SOFT chart making higher highs over the last several months.
In April, CSE-listed shares were scantly traded and holding around a dime each. With the news of the letter of intent to buy CleanGo GreenGo in May and subsequent product events, trading volumes have become more regular and the price has appreciated, including hitting $1.94 on August 24.
Technical traders will take note of the steady uptrend and the fact that shares of SOFT are once again at their upward trendline as the stock and broader markets go through a corrective phase in recent days. The current trendline also is in close proximity to the 50-day simple moving average (SMA), which has held as a dynamic level of support throughout the summer.
Going forward, SOFT will need to take out resistance in the areas of $1.35 and $1.50, which could set the stage for continuance of the uptrend by making a move over the recent $1.94 high.