BullMarketRun.com

From Rouyn-Noranda, Quebec (10:30 eastern time):

August Comex Gold hit a new record high this morning, reaching $1,254.50…as of 10:30 am eastern time Gold has pulled back to $1,248, a $8 increase for the day…we’ll be posting an updated Gold chart from our technical analyst within the next hour…the CDNX is unchanged at 1453…Gold Bullion Development (GBB, TSX-V) hit a new all-time high this morning of 51 cents…it’s currently at 49.5 cents, up 3 cents on the day…Jordan has been a strong buyer this morning which is significant and a positive sign…as attractive as GBB is, however, our general approach to the market at BMR is that it’s never wise to “chase” a stock…accumulating on weakness or pullbacks is always a safer strategy but difficult for a lot of investors to do…we’re in Rouyn-Noranda again today where we’ll be doing some additional research on the Abitibi region in general…Seafield Resources (SFF, TSX-V) is down a penny at 17 cents…we expect news shortly regarding Seafield’s recently announced proposed private placement of $2.5 million…BMR spoke with Kent Exploration (KEX, TSX-V) President and CEO Graeme O’Neill yesterday who is understandably distraught with the Australian government’s proposed “super tax” for mining companies which has affected the value of Kent’s stock…we’ll be posting a separate piece on Kent later today…Richfield Ventures (RVC, TSX-V) has come out with drill results this morning which we are still reviewing…BW-62, collared 117 metres northwest of discovery hole BW-59, graded 0.88 g/t Au over 175 metres…within that hole was a 123 metre section grading 1.09 g/t Au between 102 and 125 metres depth…the stock is currently off 19 cents to $1.12 on volume of 141,000 shares…

From Rouyn-Noranda, Quebec (11:05 am eastern time):

Gold dropped as low as $1,210 this morning but has reversed sharply and as of 11:05 am eastern time is now ahead $12 an ounce to $1,232…the CDNX, trying to reverse a 4-session slide, is down 7 points to 1458…the Venture has areas of very strong support at 1400 and higher…the pullback from last week’s high of 1514, after a run of almost 9% over a very short period, is not surprising and we expect further consolidation before this market ultimately moves significantly higher…there is considerable fear in the markets overall right now which we view as a positive sign…Gold Bullion Development (GBB, TSX-V) is showing strength this morning and is currently at 44.5 cents, up 1.5 cents, on over 400,000 shares…Gold Bullion’s Granada Gold Property is such an exciting project with tremendous exploration upside, particularly to the east as confirmed in a Quebec Ministry of Mines report that we wrote about yesterday…we also see great potential within the current Preliminary Block Model at depth (>300 metres)…Gold Bullion has reported they do intend on drilling some deep holes (300 to 500 metres at least) during this Phase 2 drill program…the rich mining history of Rouyn-Noranda is really something to marvel at, and we’ll be reporting more on this tomorrow…the BMR Portfolio is relatively quiet this morning…Seafield, which we’re watching closely, is currently unchanged at 17 cents…we expect news shortly on the closing of Seafield’s recently announced proposed private placement of $2.5 million…Richfield Ventures (RVC, TSX-V), which may have bottomed last week at $1.07, is unchanged at $1.25…investors should stay patient with Sidon International (SD, TSX-V) which continues to put the pieces together on its proposed exploration move into Tanzania…Sidon is unchanged at 4.5 cents as it continues to trade in an area of very strong technical support…

From Rouyn-Noranda, Quebec:

The Quebec Ministry of Mines web site (link is provided at the end of this article) is a tremendously valuable resource for both companies and investors and we encourage our readers to use it as a tool in their research and due diligence.  That’s exactly what we did recently and on Friday we received a treasure chest of historical information on Gold Bullion Development’s (GBB, TSX-V) Granada Gold Property eastern extension.  What we’re sharing in this important article is publicly available information that anyone can access (for a price) through the Quebec Ministry of Mines – it just so happens that BullMarketRun, determined to perform all the proper due diligence it can for its many readers on this very exciting Gold Bullion exploration story, is the first to report on the document titled, “Geology, Structure and Gold Mineralization, Granada Extension Property, 1994.”    The lengthy report with maps, which we are still reviewing, was prepared for KWG Resources which in the 1980’s and early-to-mid-1990’s was exploring Granada for individual, high grade quartz veins which could support underground mining.  A couple of decades later, Gold Bullion’s approach to Granada is much different (it’s going after a low grade but very high tonnage open-pit deposit or series of deposits) because of new geological interpretations in addition to record high gold prices and new technology that allows this kind of mining operation to succeed economically.

It’s a safe bet that Gold Bullion and GENIVAR, its geological consultant, have additional information on the Granada eastern extension, including their own research, that no one is privy to.  Company President and CEO Frank Basa told BMR in a recent interview that they will put out a news release on the eastern extension when “we have everything together”.  What we’re about to do is give investors a “sneak preview” of the growing potential of the LONG Bars Zone based on the 1994 publicly available report cited above. It’s important to keep in mind that Gold Bullion’s estimate (non-43-101 compliant) of a potential resource of 2.4 to 2.6 million ounces within the Preliminary Block Model excludes the Phase 1 east-northeast discovery area and takes into account only about half of the total current strike length of the LONG Bars Zone.  So the blue sky potential of Granada is not hype or the result of someone’s overworked imagination – it is very real and something investors need to factor in to their calculations when evaluating this company.

It’s no secret that the potential strike length of the LONG Bars Zone, most recently reported as 1,100 metres, could be huge.  In fact, Gold Bullion’s March 1 news release stated, “A prominent zone of deformation, hydrothermal alteration and quartz-veining extends for at least five kilometres around the old mine workings.”  The report we’ve accessed through the Quebec Ministry of Mines’ rich bank of documents begins to connect some dots and at least partially answers the following question:  What exactly is out there going east beyond Discovery Hole GR-10-17, the easternmost hole drilled to date by Gold Bullion?

There is so much in the 1994 report that we’re still trying to work our way through but below are a few highlights for this article:

1. An east-west trending zone of shearing, alteration and quartz veining (with intrusions of syenitic feldspar porphyry) extends almost directly east of GR-10-17 to the “Aukeko Property” (a distance of approximately 2.2 kilometres) which was historically tested by a 12-metre shaft, stripping and trenching.  Sample assays in the 1930’s returned grades as high 19 g/t Au while KWG got grab sample values as high as 13 g/t Au during some ground work in the summer of 1993.  At the eastern end of Aukeko an historic showing known as the Bert Vein reportedly returned grades in excess of 22 g/t Au from three bulk samples in the 1930’s;

2. East of Aukeko (approximately another kilometre) is the “Austin-Rouyn Property” which in the 1930’s was tested by a shaft to 70 metres, 90 metres of lateral development and considerable trenching.  The “Aus” vein occupies a shear which is exposed for some 270 metres.   Grab samples as high as 200 g/t Au (6.5 ounces) were reported in 1940 while in 1946 channel sampling and a drill hole delivered some high grade results (up to 108 g/t Au) over narrow widths (less than 3 metres).

There is a great deal of material in the 1994 report that we are still reviewing. KWG completed detailed ground geophysics and geological mapping over the extension in 1993.  They outlined a number of significant structures within a 500-metre wide zone that extends for several kilometres.

The bottom line is this: Aukeko and Austin-Rouyn are right on strike with the LONG Bars Zone and it’s safe to say that Gold Bullion‘s drilling is going to make its way out to these promising areas. Investors shouldn’t get caught up in the historical numbers above but instead focus on the “big picture” which is the fact that the same geological features and structures observed so far within the Preliminary Block Model and the Phase 1 east-northeast discovery area seem to carry on for at least three kilometres further east.

The key for GBB is to follow this trend in a systematic fashion and deliver holes grading 1 g/t Au or better over wide intersections like some of their Phase 1 holes.  If they can accomplish that, then yes indeed the Granada Gold Property and the LONG Bars Zone could prove up to be a massive deposit (or series of deposits) given the fact a potential resource of 2.4 to 2.6 million ounces has already been estimated in the relatively small defined area of the Preliminary Block Model.  In addition, one cannot rule out the possibility, given the nature of the Abitibi region, of a base metal discovery over any part of Gold Bullion’s 5,000 hectare land package.  The company has already made references to signs of copper and nickel mineralization at Granada through its previous bulk sampling and in a few holes that were tested for base metal mineralization in Phase 1.

The information contained in the publicly available 1994 report, plus whatever else GENIVAR and Gold Bullion have been able to collect, is going to be of immense value to GENIVAR as it plans a drilling strategy going further east of GR-10-17.  The Preliminary Block Model is a great foundation for Gold Bullion.  While mineralization is open in all directions at Granada, the immense exploration upside is clearly to the east where we now know there are highly prospective targets and quite possibly many more to discover and go after.  Despite the historical work the eastern extension is still very under-explored.

Editor’s Note: Quebec Ministry of Mines – a valuable resource.

http://www.mrn.gouv.qc.ca/english/home.jsp

CDNX and Gold

It was a volatile week in the markets again with the CDNX down 38 points or 2.5% to 1465, just very slightly below its rising 200-day moving average…there were three triple-digit daily moves in the Dow and the TSX which were off 2% and 1% respectively last week…the CDNX is underpinned by very strong support areas at 1400 and above, so despite the fear in the markets right now – which is actually a good sign – a sudden and nasty drop below 1400 is highly unlikely…continued consolidation can be expected until the markets “sort themselves out” and break out of the doldrums that began in early May…Gold enjoyed a strong day Friday, jumping $12 an ounce to $1,220 as the Euro hit a fresh four-year low…all of Gold’s major moving averages are in bullish alignment and it’s hard to imagine a near-term correction that could take it much below $1,200 an ounce…our technical analyst sees exceptional support at $1,170…

The BMR Portfolio

Gold Bullion Development (GBB, TSX-V)

Gold Bullion continues to consolidate nicely above 40 cents and finished the week up a penny at 43 cents…BMR has canceled its plan to attend the World Resource Conference in Vancouver to remain in Rouyn-Noranda for a few more days to further study this prolific region and the Granada Gold Property in particular…we’ve obtained some publicly available historical information from the Quebec Ministry of Mines which clearly demonstrates the blue sky potential of Gold Bullion’s LONG Bars Zone, especially to the east…GBB has two drill rigs going 24/7 at the moment with one of them doing definition drilling within the Preliminary Block Model and the other doing exploratory drilling outside the Block Model…with two rigs we estimate Gold Bullion is drilling approximately 200 metres a day…the company reported last Tuesday they had completed 11 holes and 2,400 metres so far in a planned 20,000 metre Phase 2 program…

Seafield Resources (SFF, TSX-V)

We expect to hear news shortly on Seafield’s proposed $2.5 million private placement at 17.5 cents which was supposed to close Friday…the stock was off a penny last week to 17 cents where it has very strong technical support…Seafield has lost half its value since the end of February when it reached a 52 week high of 35.5 cents…with a strong treasury and some highly prospective properties in the Quinchia District of Colombia that the company will be exploring aggressively over the summer, there’s a strong chance Seafield is ready for a rebound…another interesting situation to keep an eye on with Seafield is in northwestern Ontario where Manitou Gold (MTU, TSX-V) is drilling its Kenwest Property and the Big Master Mine which is in very close proximity (immediately adjacent) to Seafield’s Elora Gold Property which has delivered very encouraging results in the past…if Manitou Gold were to make a discovery at Big Master, this would certainly have positive implications for Seafield…Manitou has plenty of cash in the bank and will be aggressively drilling its properties throughout the Gold Rock mining camp…

Richfield Ventures (RVC, TSX-V)

The recent weakness in Richfield has indeed been mysterious…the share price dropped as low as $1.07 this past week before rebounding to close at $1.25 Friday…fundamentally the company’s Blackwater Gold Project has all the makings of a potential world class bulk tonnage gold deposit as revealed in their first round of drilling last year…a 25,000 metre drill program is currently underway and more results could be out soon…technically, the stock has huge support around $1.00 and a rising 200-day moving average which is in no danger of declining…we therefore believe this weakness is only temporary…Friday’s 14-cent move was encouraging and a sign that we may have seen an important low at $1.07…

Kent Exploration (KEX, TSX-V)

Kent has dropped five of the last six trading days since jumping as high as 21 cents May 27 on the release of assay results from Gnaweeda…we have a few major concerns with Kent at the moment, not the least of which is its weak financial position…the company has also still not been able to raise the financing for the proposed Archean Star spin-off and we’re not 100% sure now that it will…a growing problem is the Australian government’s proposed 40 per cent tax on profits generated from resource projects in that country…it never ceases to amaze us how stupid and ignorant governments can be…capital can easily get scared away from a country or a region in a heartbeat if it senses it is not welcome, and Australian Prime Minister Kevin Rudd has made it clear, as far as we’re concerned, that mining investment is no longer welcome in Australia…Xstrata announced last Thursday it will axe investments worth $500 million U.S. in two projects in Australia in a move that puts the creation of $3,250 jobs at risk…if Rudd stubbornly persists with this wrong-headed policy, you will see a mass outflow of mining investment in Australia to the benefit of other areas in the world (places such as Quebec) where governments encourage mining and exploration in every reasonable way…taxes kill jobs and investment but the Labour government in Australia, not surprisingly, hasn’t figured that out…they may learn the hard way…where does this leave Kent?…the stock closed at 13 cents Friday, a drop of 4.5 cents on the week…we hope they’re still able to pull off the Archean spin-off and they have an excellent project in New Zealand (Alexander River) and the Flagstaff Barite Property in Washington State…under pressure, it’s possible Australia may reverse its proposed “super tax” but whether they do is anyone’s guess…

Sidon International (SD, TSX-V)

There is very little to report on with Sidon as we await news on its proposed financing and further information on its plans regarding the Morogoro East Gold Property in Tanzania…at the end of March Sidon signed a letter of intent with a private company for an option to earn an 80% interest in Morogoro or even a 100% interest under certain conditions…this is a highly prospective property in an under-explored region of Tanzania where mining and exploration have experienced tremendous growth over the past decade…technically, Sidon has extremely strong support at current levels…it closed Friday at 4.5 cents on low volume, a half-cent drop for the week…

North Arrow Minerals (NAR, TSX-V)

North Arrow was down 2 cents on the week at 17 cents…as we mentioned when we introduced this company a couple of months ago, this is not a stock to flip or trade but a tremendous opportunity that an investor has to be patient with…North Arrow is led by Gren Thomas, a member of the Canadian Mining Hall of Fame, who is renowned for his part in the discovery of the Diavik diamond deposit in the Northwest Territories…Thomas is as good as they get in the grassroots exploration business and he has partnered again with Dr. Chris Jennings, who BMR interviewed recently, to help North Arrow make a discovery at its Las de Gras holdings (on trend with Diavik) where drilling commences this summer…North Arrow is also currently drilling its promising Beaverdam Lithium Project in North Carolina…we see great things ahead for North Arrow which has the money in the bank to carry out all of its exploration plans this summer…

Colombian Mines (CMJ, TSX-V)

Colombian took a hit this past week, dropping 13 cents to 84 cents but on low volume…the stock is now very close to its rising 200-day moving average of 78 cents where it should find strong technical support…fundamentally, CMJ holds a very large and attractive package of properties in Colombia that hold considerable blue sky potential…with a strong management team and a healthy balance sheet, the outlook for CMJ remains very positive…

Greencastle Resources (VGN, TSX-V)

Greencastle released its updated financials last Monday (to March 31) which showed cash in the bank of just over $4 million and total working capital of approximately $5.5 million or 12 cents per share…the stock closed Friday at 12.5 cents, a half-cent drop for the week…as we have mentioned before, the best strategy with Greencastle is to buy it when it drops near or just below its cash value and simply wait for it to make its run and then sell…short-term, there’s no way of telling where Greencastle is going but from a medium to long-term perspective it’s an excellent value at current levels…

Below is a slide show of eight pictures we took from the Granada Gold Property – enjoy (there is 10 seconds between each picture which automatically changes).

[aslideshow effect=”fade” play=true playframe=false controls_play=true]

Entrance to the Granada Gold Property just 1.5 kilometres southeast of the village of Granada and 5 kilometres south of the Rouyn-Noranda city centre.

This is the second Landrill International Inc. rig which commenced drilling within the Preliminary Block Model mid-week. It started just east of the waste pile and just north of Pit #2 East.

Granada’s Wild West: This is looking west of Pit #1 where a number of holes were drilled in the 1990’s, searching for high grade quartz veins. Detailed follow-up drilling in the far west portion of Granada was recommended in a 2006 Technical Report. Drill hole 92-19 intersected 4.7 g/t Au over 3.4 metres while 92-18 encountered 6.3 g/t Au over 2.35 metres.

This is a view from the top of the waste pile (eastern side) looking toward Pit #2 East. A Landdrill RVT is in front of the gate while two pump shacks, each with 1,500 metre hoses, are taking water from Pit #2 East to feed the drill rigs.

The Granada waste pile is huge – this is just a portion of it (eastern half). Gold Bullion’s sampling of its waste pile in 2007 returned a stunning grade of 1.75 g/t Au. The stick with a flag is a planned drill hole.

GENIVAR’s Nathan Jourdain standing at Pit #2 West where a considerable amount of historical mining took place at Granada.

GENIVAR’s Project Manager for Granada (Geologist Nicole Rioux) along with Technician Nathan Jourdain.

GENIVAR’s Project Manager Nicole Rioux returns from visiting a drill site with a Rouyn newspaper reporter who was at the Granada Property Friday (June 4).

[/aslideshow]

From Rouyn-Noranda, Quebec (9:00 am eastern time):

Due to important developments, BullMarketRun is extending its visit to Rouyn and the Granada Gold Property.

Readers may find it curious we have not posted from Rouyn since our regular “Morning Musings” yesterday, a couple of hours prior to the market open.  The reason is quite simple – we have been overwhelmed with new information including an important historical report we have obtained from the Quebec Ministry of Mines (publicly available but at a price) regarding the Granada eastern extension.  This is eye-popping, treasure chest material that clearly outlines the enormous blue sky potential of the LONG Bars Zone with areas of significant gold mineralization at least three kilometres east of current drilling.  We are continuing to review this important material in order to present it as accurately as possible to our readers.

We were on the Granada Property yesterday and we are sorting out new pictures to post by tomorrow morning at the latest.  In the meantime, we have posted an updated chart analysis on GBB from our technical analyst.

I was asked if I can sum up, in one sentence, my impressions so far regarding this visit.  Not hard at all to do – this is not hype, this is very genuine and straight from the heart:  I am overwhelmed by what I have seen the first three days, which is why this trip is being extended.

From Rouyn-Noranda:

As we continue our visit and examine the fundamental factors that are influencing Gold Bullion Development (GBB, TSX-V), it’s also important to keep an eye on the “technical” state of affairs with the stock and discern what’s happening there.  The overall markets dropped sharply yesterday but GBB managed to buck the trend.  John provides an updated analysis below:

The Gold Bullion Development chart continues to look very bullish.

John: The strength of Gold Bullion Development is defying the general weakness of the markets.  The stock continues to consolidate while waiting for exploration news.

Looking at the daily chart, we see that an ascending triangle (blue lines) has formed.  This is a very bullish consolidation pattern.  With good news GBB should have no trouble breaking out to new highs.

The 50SMA is providing strong support and is pointing upwards, confirming a bullish trend.

Looking at the indicators:

The average volume is declining but this is normal for all consolidation patterns.  The absolute value is still high with 715,000 shares traded Friday.

The RSI is bullish, oscillating between 50% and 70%.

The ADX trend indicator is in bullish orientation with the ADX trend strength (black line) high at 31, above the +DI (green line) which is above the -DI (red line).

The Chaikin Money Flow (CMF) indicator is in the very bullish range (i.e., above the zero line at a value of .28).  Even though the stock is consolidating, the CMF shows that buying pressure is increasing – very bullish.

Outlook: Gold Bullion Development is displaying strength in a down market.  With good exploration news and drill results the sky is the limit.

From Rouyn-Noranda, Quebec (7:30 am eastern time):

We are departing for the Granada Gold Property early this morning, nearly a couple of hours prior to the market open…the key market-moving event today could be U.S. non-farm payrolls which will be released at 8:30 am eastern time…Gold is showing some more weakness today and as of 7:30 am has slipped just under $1,200 an ounce…BMR first uncovered Gold Bullion Development (GBB, TSX-V) nearly 6 months ago and its stock price has increased 6-fold since that time…however, especially after our first two days here in Rouyn, we can firmly state that we are more bullish than ever on the prospects for this company…when the masses start discovering Gold Bullion, which undoubtedly they will and likely quite soon, the current share price of 42.5 cents will be looked upon in our view as an incredible bargain and ground floor opportunity…there is a sense of urgency with GBB, confirmed in our interview yesterday with Frank Basa, in terms of getting assay results for Phase 2 drilling which is a positive sign…drilling is proceeding at a rate of at least 200 metres a day and an all-out assault on the east-northeast extension and beyond is underway…the drill rig that just arrived is doing in-fill definition drilling within the Preliminary Block Model with Gold Bullion determined to deliver a preliminary NI-43-101 resource estimate by year-end…the possibility of the LONG Bars Zone stretching out several kilometres to the east is very real given historical information on Granada…in short, this has all the makings of a possible HUGE bulk tonnage, open-pit deposit surrounded by all the necessary infrastructure in the world’s #1 jurisdiction for mining and exploration…when the masses catch on to what’s unfolding here, look out…in 25 years of investing, this is truly one of the most exciting situations I’ve ever seen…on the first edition of BullMarketRun TALK yesterday, our technical analyst stated, “It (Gold Bullion) looks extremely good.  I don’t know another stock on the CDNX which looks as strong”…this is not hype or wishful thinking…Granada is the real thing and it would be a mistake to underestimate the significance of what Gold Bullion is in the process of discovering and developing…we urge investors to do their due diligence as well on a company by the name of Manitou Gold (MTU, TSX-V) which obtained a highly prospective package of properties in northwestern Ontario from Goldcorp Inc. (G, TSX)…Manitou is well-funded with approximately $2 million cash in the bank and is in the process of completing a $3 million flow-through financing at 75 cents…they are currently drilling the former Big Master Mine on their Kenwest Property, 50 kilometres southwest of Dryden within the historic Gold Rock Mining Camp…Manitou was just listed on the Venture Exchange three  months ago, so this is still a well-kept secret…liquidity in the stock will no doubt improve as the word gets out…Goldcorp currently has a 15% stake in Manitou which has 22 million shares oustanding…the stock closed yesterday at 49 cents…