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At BullMarketRun, we knocked the ball out of the park in recent months on the two stocks we uncovered that were trading under a dime – Gold Bullion Development (GBB, TSX-V) which is up 300%, and Seafield Resources (SFF, TSX-V) which has also gained a whopping 300%.

Today we added 5 cent Sidon International Resources (SD, TSX-V) to the BullMarketRun portfolio, our first new stock since Gold Bullion back in December.  Gold Bullion of course has made a significant discovery at its Granada Gold Property near Rouyn-Noranda, Quebec, and we see similar blue sky potential with Sidon which announced this morning that it has entered into a letter of intent to acquire an initial 80% interest in the Morogoro East Gold Property in Tanzania – 100 kilometres south of Canaco’s (CAN, TSX-V) Handeni Gold Project.

We’ve been watching Sidon closely over the past 10 days or so after a volume breakout on March 22 when the company announced the acquisition of 2100 hectares at Windfall Lake near the recent discovery by Eagle Hill Exploration (EAG, TSX-V).

Today’s news from Sidon, however, made us pull the trigger.  It was hugely significant for a company with a market cap of only $4 million.  Exploration success at Handeni has given Canaco a market cap of $60 million – Tanzania is hot and still has enormous untapped potential even after a significant number of major discoveries over the past decade.

Laurence Stephenson is Sidon’s consulting geologist who lives in White Rock, BC, not far from us.  This veteran geologist knows Tanzania like the back of his hand, and he’ll be heading out there again late next week.  He is hugely bullish on this part of the world for gold exploration and very excited about what he has found for Sidon.   “The grades at Morogoro East are higher than what I first saw at Canaco,” Stephenson explained to us this afternoon.  “The big companies haven’t had the expertise or the time to look around.  It’s like the wild frontier of the 1860’s.  This area hasn’t had any exploration.   The gold and formations are really interesting.”

The Morogoro East Property is a flat-lying sedimentary-type horizon that Stephenson believes could be drill-ready as early as June.  The grades local miners have been scoring (and they’re only processing the free gold, not the sulphides) are astronomical – 40 to 60 grams of gold per 25-kilogram bag of recovered rock which equates to approximately 1,600 grams per tonne.  Little pits can sometimes develop into big gold mines, and that’s what Sidon will be hoping for here.  There is gold at Morogoro and perhaps LOTS of it including high grade.

Tanzania is a mining friendly jurisdiction.  Ten years ago, when it had only a million ounces of gold reserves, it revamped its Mining Act which brought in huge amounts of new investment.  Now it has over 50 million ounces of reserves, contributing significantly toward the country’s annual GDP and placing it third among African-producing countries behind only South Africa and Ghana.

Sidon has been searching for a flagship, company-making project and we believe they have scored a coup on this Morogoro East option deal with Kokanee Placer Ltd. through its private Tanzanian subsidiary company.

Sidon has 78 million shares outstanding and its empty bank account at the moment is not a concern for us (Gold Bullion and Seafield were both in the same position before they exploded).  Sidon will have no problem raising money for a project such as Morogro East – the 80% option is for 7 million shares, $1.5 million in cash and $1.5 million in exploration over a two-year period.

From a technical standpoint, now is clearly the time to be positioned in Sidon.  The volume breakout March 22 was a sign that something big was developing with this company – we saw a similar volume breakout with Gold Bullion in early December last year.  All of Sidon’s moving averages are in bullish alignment.  The stock has been under heavy accumulation and seems poised to bust through resistance between 6 and 7 cents and challenge its 2008 high of 17 cents as the three-year chart below illustrates:

Sidon is poised for a major technical breakout as this three-year chart illustrates.

At BullMarketRun we specialize in identifying situations exactly like Sidon – a company with a low market cap, entrepreneurial drive, an excellent project and a great story to tell that the overall market just hasn’t discovered yet.  We’ll be reporting much more on Sidon in the days and weeks ahead.  The stock closed today at 5.5 cents, up a penny on volume of 5.2 million shares.

Welcome to our site, or at least a sneak preview of it! The final version will look much different than this as we develop a fully-integrated and very unique business, investment and money-management resource site.

An important component of this site is going to be original research on small and undiscovered junior resource companies that offer very real and significant upside potential. We are extremely selective in the companies we feature and put forward to investors – we prefer quality over quantity. Management is the first thing we look at – it’s our #1 criteria – because without superb or solid management, a company with the best properties in the world is either going to underperform or flat-out fail. As simple as that. So we look for superior management guided by strong business ethics and integrity, followed by an outstanding portfolio of projects.

Disclaimer:

BullMarketRun.com is completely independent from any companies we cover. We accept no compensation of any kind from any groups, individuals or corporations mentioned on our site. Our stock coverage is for informational purposes only and must not be viewed or interpreted as “buy”, “sell” or “hold” recommendations. No investment opinion or other advice is being rendered on any stock or company. We strongly recommend that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, and do your own due diligence and research before making any investment decisions. The stocks we cover, by definition, are highly speculative and potentially very volatile. Investors are cautioned that they may lose all or a portion of their investment if they make a purchase or short sale in these speculative stocks. We are not Registered Securities Advisors. Our opinions can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.  It should be assumed that BullMarketRun.com writers and their associates may hold or dispose of or trade in positions in any securities mentioned herein at any time.

SD (TSX-V) Alert – 12:25 pm Pacific time Wed., March 31

Currently trading at 5 cents

Sidon International Resources is making a gold exploration push into a highly prospective area in Tanzania.  Late this morning we spoke to the Sidon consulting geologist who knows that area extremely well, and we’ll be reporting more on SD this evening (8 pm Pacific time).   The market has yet to pick up on the significance of this story.

Gold is up strongly this morning as the U.S. dollar retreats…as of 7:45 am Pacific time, gold is $13 higher at $1,116 per ounce…the CDNX is up 3 points to 1573 on this final trading day of the month and quarter…our favorite pick at the moment, Gold Bullion Development (GBB, TSX-V), is a little weak this morning and down 2.5 cents to 27 cents…as we stated Monday, accumulating Gold Bullion under 30 cents while it completes its private placement is a wise strategy…reports are, the $4 million PP is heavily oversubscribed which may cause some minor delays in closing it…we were hoping to see Gold Bullion close its PP by the end of this week, but the end of next week now appears more realistic especially with Easter coming up…in any event, we expect April to be a huge month for GBB…Seafield Resources (SFF, TSX-V) was under pressure this morning and hit its 100-day moving average at 22 cents (just 2,000 shares traded at 21 cents)…the last time that happened was back in early December, just prior to a big move to the upside…the time to buy Seafield is always when it’s under pressure like this…also under a little bit of pressure is Colombian Mines (CMJ, TSX-V) which should find strong support at $1.30, just above its 20-day moving average…CMJ is currently off 3 cents to $1.32…Richfield Ventures (RVC, TSX-V) has come off its highs (trading at $1.75 this morning) and is also a great pick for the month of April when drilling resumes at its Blackwater Project in central British Coumbia…we have at least one new stock to add to our portfolio very soon as we are in the process of completing our due diligence on a company that we believe could deliver similar returns to Gold Bullion and Seafield which are each up over 300% from when we first introduced them at BullMarketRun…make sure you subscribe to our free BMR eAlert service to be notified of this company instantly by email as we post our article…simply send us an email to i[email protected] with the subject heading “eAlert” and your first name…

The move we’ve seen in the CDNX since late 2008 has a lot of similarities to the action we saw in the early part of the decade when the Venture began a five-year run in late 2002 that took it from just under 900 to nearly 3,400 by May of 2007.  That very profitable “bull market run” was interrupted by three major and painful corrections of 20% or more leading to the May ’07  high – one each year during 2004, 2005 and 2006.  History tells us, then, that we can expect a major CDNX correction sometime this year (there wasn’t one in 2009).   We’re not saying this to scare anyone – it’s just the law of averages and the way bull markets work, especially with the CDNX.   An occasional good shakeout and “cleansing” is necessary for the long-term sustainability of a junior resource bull market and can be a great money-making opportunity if you’re prepared.

The good news is, we believe the current market will move higher (just how high remains to be seen) before the 2010 correction hits (and we’re sure there will be one).   We say that because the CDNX continues to show momentum and tremendous resilience as it outperforms both gold and the TSX Gold Index.  When the Venture starts to underperform, that’s when we have to very concerned – July, 2008, was a great example.

The chart below shows the CDNX between January 1, 2004, and May 31, 2004.  You’ll notice the market ran to a high of about 1935 in mid-February.  It pulled back 5%, then made another attempt in March and again in April to break through the February high.  Those attempts failed, and you’ll also notice the declining volume through March and April as well which was not a good sign. The light blue line is the 20-day SMA while the dark blue represents the 50-day SMA.  As soon as the two were declining in tandem, it was game over for the immediate short term and the CDNX plunged several hundred points before the bull market resumed its upward journey.  We can expect the same thing again at some point in the near future.

CDNX between January 1, 2004, and May 31, 2004. Market top occurs in mid-February with failed attempts to break to a new high in March and April, followed by a 20% plunge.

In the current context, we believe there’s an excellent chance the CDNX is going to take a run at its January high during the month of April as we suggested yesterday.   This will be a critical moment for the market and we’ll be watching the action very closely to determine if it’s time to take profits off the table and exit or stay in and keep buying.

There are many ways to view an individual stock and the market in general from a technical analysis standpoint.  Sometimes, though, simple is better.  The key short-term guage with the CDNX we believe is its 20-day SMA (the RSI or Relative Strength Index is also very reliable).  History has shown that you want to be in this market on a rising 20-day moving average, and out on a declining one, when there is also the support of rising longer-term moving averages (100 and 200 day) which confirm the ongoing overall bull market.

The CDNX’s 20-day SMA continues to rise and the market could get some additional technical support next week with another potential reversal in the 50-day SMA.  The 50-day recently started to decline but will advance again at the beginning of next week if the CDNX stays above support at 1550.  This would be a bullish development and would clearly suggest an assault on the January high is imminent.

Gold this morning is digesting its gains from the past two trading sessions and is currently down $1 an ounce to $1,108 (as of 7:15 am Pacific time)…the CDNX is down 1 point to 1,571…Gold Bullion Development (GBB, TSX-V) has enjoyed two strong days in a row and investors should be careful not to “chase” this as a minor pullback to the upper 20’s and a little more consolidation is likely from a technical standpoint before another new up-leg really kicks in…Gold Bullion touched 31 this morning and is currently at 30 cents, up half a penny from yesterday…Richfield Ventures (RVC, TSX-V) has pulled back this morning and is looking very attractive in the $1.70’s…Richfield has come out with news confirming that its 20,000 metre Blackwater drill program will commence within 2 weeks…Seafield Resources (SFF, TSX-V) is showing some weakness and is currently at 24.5 cents, down half a penny…history has shown that Seafield is always a great buy when it gets smacked down…we’ll be introducing a new stock to our portfolio very soon – at the latest, immediately after Easter…make sure to sign up for free BMR eAlerts by sending us a quick email ([email protected])…we won’t bombard you with email as we emphasize quality over quantity…

Gold is up $5 an ounce to $1,112 as of 8 am Pacific time as it tries to build on Friday’s encouraging gains…based on last week’s performance and the follow through we’ve seen this morning, we’ve gone from cautious to bullish with regard to our near-term outlook on the CDNX (for reasons explained in our Week In Review article) which is up a further 11 points this morning to 1,571…at the very least, we expect the CDNX to challenge its 52-week high of 1,629 over the next couple of weeks…Gold Bullion Development (GBB, TSX-V) is the type of stock that will significantly out-perform the market during this period…an excellent article by the Coffin Brothers the other day (made available on Kitco) sums it up best…”gold explorers putting out good results and generating volume continue to be well regarded by the market…they will continue to be a favored space”…Gold Bullion could enjoy a meteoric rise in April with more news and a resumption of drilling at Granada,  so accumulation under .30 at the moment makes a lot of sense…if Gold Bullion has what we believe it has,  a 10-bagger on this stock from current levels within six months is very achievable…investors need to be thinking big on this one…GBB is unchanged this morning at 26.5 cents…we are also extremely bullish on Richfield Ventures (RVC, TSX-V) and Colombian Mines (CMJ, TSX-V) for the month of April…CMJ continues to drill at Yarmualito in Colombia while Richfield is getting set to commence a 20,000 metre program at its Blackwater Project in central British Columbia…Blackwater, like Granada, has multi-million ounce potential as a bulk tonnage, open-pit deposit…we’ll be announcing the addition of a new stock to our portfolio as we begin the month of April…

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