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Commodities are strengthening again after taking a slight breather to begin the month of May after strong gains in April…Gold jumped 8.1% last month, Silver climbed a whopping  28% while crude oil was up 6.8%…interestingly, the TSX Gold Index gained only 2% last month while the TSX Venture Exchange lost 1.9% after a 4% setback in March…as of 8:20 am Pacific, Gold is now up $8 an ounce to $1,574 and has hit yet another new record high…this is a powerful intra-day reversal as the yellow metal fell as low as $1,540 this morning…Silver dropped about 10% overnight due in part to thin trading because of holidays in many parts of Asia and Europe…it too is strengthening and is currently down just 77 cents an ounce to $47.17…while Silver has been on a near-vertical rise of late, it’s interesting to note that commercial traders’ short positions have dropped to their lowest levels in many months – the commercials are hardly ever on the wrong side of the trade, so this is very interesting and suggests Silver, though clearly in overbought territory at the moment, may have further to go on the upside over the near-term before a substantial correction kicks in…the U.S. Dollar Index rallied to nearly 73.30 overnight on the news of the killing of the world’s most wanted man, Osama Bin Laden, but the greenback has surrendered its gains over the last few hours which makes one wonder what could possibly give it a sustained lift…the U.S. Dollar Index is heading south again and at the moment is down one-quarter of a point at 72.75…while the killing of Bin Laden is a victory for the west, a triumph of good over evil, the war on terrorism continues and may even have to be ramped up if Bin Laden’s death somehow energizes al Qadea and Muslim extremists around the world…that’s the sobering reality…the al Qaeda leadership transition will likely be seamless with Ayman al-Zawahri, Bin Laden’s Egyptian right hand man, probably taking over…his extremist views and his readiness to use deadly force are beyond doubt…he’s also known for his superb organizational skills and is the new public enemy #1 who needs to be taken out…Canadian markets are suggesting a positive outcome in today’s general elections…the NDP may have peaked too early…while there is certainly a degree of unpredictability regarding this election, the final opinion polls suggest to us that the Conservatives will win anywhere from 140 to 155 seats with the NDP replacing the Liberals as the Official Opposition…vote splitting in Ontario could allow the Conservatives to squeak out a razor-thin majority…if they’re able to garner at least 140 seats, which seems likely, this should thwart the possibility of an NDP-led coalition government…it’s unlikely the Liberals will prop up a party that just replaced it as the Official Opposition…the CDNX has started the new month on a sluggish note with a decline of 6 points to 2246 as of 8:20 am Pacific…Gold Bullion Development (GBB, TSX-V) announced a proposed private placement financing after Friday’s closing bell to raise as much as about $5 million, mostly at 61 cents through the issuance of flow-through shares…it was necessary for the company to beef up its treasury so we view the news as very positive even though we prefer to see hard cash financings…GBB is unchanged at 46 cents on light volume…given its bullish chart patterns and the pending start of a major drill program at its properties in Tanzania, we consider Currie Rose Resources (CUI, TSX-V) to be one of our best opportunities for the month of May…the stock closed up a penny last week to 18 cents and remained above its 50-day moving average (SMA) throughout April…the 50-day has flattened out and appears ready to reverse to the upside in the very near future which would be another bullish development in addition to the just completed “cup with handle” formation…we are particularly excited about Currie Rose’s Sekenke Project in northwest Tanzania which we regard as the company’s #1 play as it holds major blue sky potential…Sekenke covers a lot of promising ground and runs in between and surrounds two former high grade Gold mines including one of Tanzania’s original producers…Sekenke will likely be the first target of CUI’s upcoming drill program…Visible Gold Mines (VGD, TSX-V) has touched its rising 300-day moving average at 34 cents…we have caught on to the VGD story early, just like we did with Gold Bullion, and we’re confident Visible Gold Mines will emerge as a huge winner in northwest Quebec under the geological guidance of Robert Sansfacon…from a business standpoint, the company is led by the very successful Martin Dallaire who has a clear plan to generate shareholder value…Orko Silver Corp. (OK, TSX-V) touched its rising 50-day SMA for the third time this morning since March…the stock made significant upside moves following the previous two occasions it did so…OK is currently off 2 pennies at $2.71…GoldQuest Mining (GQC, TSX-V) is heavily oversold technically after falling 36% last month…the stock is unchanged at 23 cents this morning…it has exceptional support at its 500-day SMA of 20 cents but may have bottomed out last week at 21.5 cents…we suggest investors perform due diligence on Probe Mines (PRB, TSX-V) which last week closed a $25 million financing at $1.35…the company has been delivering solid drilling results from its Borden Lake Gold Property in Ontario and also holds the Black Creek chromite deposit at McFauld’s…while the stock’s 50 and 100-day SMA’s are in decline, it has strong support at its rising 200-day SMA around $1.20…Probe hit an all-time high of nearly $2.40 last December…it’s up a penny at $1.36 this morning…

While Gold and Silver are currently both overbought, John’s charts this evening show that each could surpass last week’s record highs over the near to short-term and reach extreme overbought conditions before a correction sets in.  How this would play out with the stocks is uncertain – the CDNX actually declined 1.3% last week while the TSX Gold Index was off 1.7%.  It’s as if the stocks have already started to factor in a coming correction.

What’s perplexing about Silver at the moment is that despite its parabolic move of late, commercial traders’ short positions have dropped to their lowest levels in many months – the commercials are hardly ever on the wrong side of the trade, so this is very interesting and suggests Silver may have further to go on the upside over the near-term despite weakness this evening.  As of 8:50 pm Pacific, Silver is down a whopping $4.11 an ounce to $43.83 while Gold has dropped $18 to $1,548.

Bottom line – be prepared for high volatility for both Gold and Silver.

The U.S. Dollar is rallying this evening on the surprising and tremendous news that Osama Bin Laden, the face of terrorism and anti-western hatred, has been killed by the U.S. military in Pakistan – an historic and momentous moment indeed.  This is certainly cause for celebration and has the potential of triggering a significant short-covering rally in the greenback but the “big picture” outlook for the U.S. Dollar remains grim.

John: Many times I have warned our readers that a stock price or index level had risen too far and too fast from a supporting moving average and thus were vulnerable to a correction.  Tonight we are going to look at the positions of Gold and Silver with regard to their obvious overbought situations. How susceptible are they to immediate corrections?

In order to analyze the charts I am going to use an indicator known as %B. This indicator quantifies the relationship between the price and Bollinger Bands. First we have to determine the primary trend which for both Gold and Silver is up. We now identify an appropriate supporting daily moving average which is SMA(300) for both.

Because we have an uptrend, %B can be considered oversold when it moves to or below 0.5 and is considered overbought when it reaches or exceeds 1.0.   Now look at Chart #1 immediately below – Gold (continuous contract). This is a 10-year daily chart with both daily SMA(200) and SMA(300) shown. I have also shown %B(200,2.0) and %B(300,2.0). For our use I have selected the %B(300,2.0) because, except for the crash in 2008, all the values are above 0.5 which means the price of Gold (POG) was above its SMA(300). Anything below 0.5 is considered oversold.  If we identify the POG price peaks (vertical green lines) we see they correspond to a %B(300,2.0) reading between 1.25 and 1.35, thus we can expect the %B value to rise to at least 1.25 before we can expect a peak followed by a major correction.

Friday’s %B level for Gold was 1.11.

Chart #1 (Gold through April 29)

For Silver (continuous contract) we look at Chart #2.  This again is a 10-year daily chart and we again will be using the %B(300,2.0) indicator.  This time we see the %B band identified between 1.3 and 1.6 with price peaks often occurring around the 1.6 level.  With Friday’s %B level at 1.26, Silver still has room to move up before it is expected to peak and correct. I have also shown 3 gradients and presently the Silver price is on the 3rd and steepest gradient so we can expect a peak and correction later this year.

Conclusion: I expect Gold and Silver to climb higher before peaking and then correcting.

Chart #2 (Silver through April 29)

Visible Gold Mines (VGD, TSX-V) was off 2 pennies for the week at 35 cents but volume was unusually light with just under 400,000 shares changing hands on the CDNX…selling pressure has abated as demonstrated by the CMF and the RSI(14) is at a support level that has held for nearly the past year…the rising 300-day moving average at 34 cents continues to underpin the stock from a technical perspective…BMR was the first to discover Gold Bullion Development (GBB, TSX-V), which led to massive profits for some of our readers, and we’re confident history could repeat itself with Visible Gold Mines as we are on this story before anyone else through careful research and due diligence…this is an aggressive company with $8 million in its treasury, strong management and one of the best geologists in the country in Robert Sansfacon who was instrumental in the discovery of Osisko’s (OSK, TSX) Canadian Malartic Deposit…VGD is quickly emerging as an exploration leader in northwest Quebec, specifically in the Rouyn-Noranda region…its flagship property is Joutel, a significant former Gold-Silver producer that gave birth to Agnico-Eagle Mines Ltd. (AEM, TSX) in the 1970’s…VGD just recently optioned Joutel from Agnico-Eagle and exploration will be starting soon…at the moment Visible Gold Mines has two drill programs in progress with one rig at the Silidor Gold Property, also a former producer, and another rig at its Kanasuta claims very close to Vantex Resources‘ (VAX, TSX-V) Moriss Zone discovery at its Galloway Project…following completion of four holes at Kanasuta (two are already complete, reaching depths of 756 and 656 metres, respectively), that drill rig will move east to the area near Richmont Mines‘ (RIC, TSX) growing Wasamac deposit…it’s our belief VGD could have its sights set on acquiring a bigger and more strategic land package around Wasamac…it tried but was not able to work out an option agreement with Cadillac Mining (CQX, TSX-V) in December regarding  seven claims that are tied on to the Wasamac deposit…Cadillac may have been holding out for a better deal…we’ll see what happens on that front but VGD is clearly in a better position than Cadillac to explore that highly prospective and strategic ground…initial drill results from VGD’s Silidor Property were released April 20…each of the first 10 holes at Silidor intersected mineralization and Hole #8 is of particular interest as four sections of Gold were hit between depths of 70.85 metres and 130.5 metres including 2.70 metres grading 5.45 g/t Au and 1.5 metres grading 5.70 g/t Au…this area has never been drilled before and it’s 700 metres southwest of the former Silidor mine…a total of 23 holes have now been completed (assays pending for 13 of them) and drilling continues in a northeasterly direction toward the former mine…things could get extremely interesting in a real hurry at Silidor with geologists of the opinion they could be closing in on a series of ore shoots…Silidor is just one of four major projects Visible Gold Mines is currently advancing…besides Joutel and Cadillac Break, VGD holds the Stadacona-East Property at Rouyn-Noranda which has an inferred resource of 164,000 ounces with potential for significant expansion with additional drilling…the President and CEO of Visible Gold Mines is Martin Dallaire, a very successful entrepreneur in Rouyn-Noranda with an engineering degree who understands the mining industry and what an exploration company needs to do to succeed and build shareholder value…Dallaire is fluently bilingual, presents himself extremely well and knows how to run a business and make money…he thinks big but is focused…he has also recruited some key people including Sansfacon, a highly respected geologist who honed his skills for many years with Lac Minerals…in short, Dallaire has put something together you don’t often see in the junior speculative market – a powerful dynamic of business, geological and marketing expertise with a strategic plan to rapidly build value…the company’s niche and sole geological focus is northwestern Quebec where it has acquired several promising land packages, mostly west and north of Rouyn-Noranda…Dallaire is taking an aggressive approach to exploration and he’s targeting under-explored areas and past producing mines where major new extensions are possible…

GoldQuest Mining (GQX, TSX-V)

GoldQuest is clearly in oversold territory and finished the week down 2 more pennies to 23 cents…it has had only one up day out of the last 11…for the month of April it was off 36% and the 100-day moving average (SMA) began declining after advancing for eight straight months…technically, therefore, some significant damage has been inflicted on the stock but downside risk from current levels is limited given the exceptional support at the 20-cent area which is where the rising 500-day SMA sits…the 200-day SMA at 29 cents also continues to rise and that’s where resistance can be expected for now on the upside…the substantial drop in the share price is due to general market weakness and selling from speculators whose expectations may have been too high regarding initial drill results from the company’s La Escandalosa Project in the Dominican Republic…the results were good and support the resource model but were far from spectacular…17 holes are in from Escandalosa with seven more pending…results confirm that mineralization remains open to the north toward Hondo Valle, a distance of 1200 metres…best assays included 36.5 metres grading 2.74 g/t Au in hole #62, 16 metres grading 2.45 g/t Au in hole #47, and 9.2 metres grading 3.54 g/t Au in hole #48…the fact that any potential southern extension of La Escandalosa may have been displaced by faulting, as reported, is not a big surprise or a major concern as the ground going north has always been considered more prospective and provides GoldQuest with all the opportunity it needs to achieve its goal of a 1 million+ ounce deposit…another round of drilling at Escandalosa is scheduled for the second half of this year…in the meantime the company has other highly prospective targets in the DR to explore including Las Animas and Jengibre…GoldQuest’s potential has not diminished whatsoever yet the share price has dropped in half from its early February high…the company released a 43-101 resource estimate March 2 on its Toral zinc-lead-Silver deposit in Spain…it showed slightly lower grades but much higher overall tonnage than the previous historical non-compliant estimate…as a result, total resources came out 15% higher…resources in the indicated category are 4.04 million tonnes grading 11.8% lead and zinc (5.3% lead, 6.5% zinc) as well as 41 g/t Ag and 0.11% Cu… inferred resources are 4.67 million tonnes grading 9.8% lead and zinc (4.44% lead, 5.4% zinc), 32 g/t Ag and 0.14 Cu…Toral has significant exploration and development upside as a majority of the historical drilling (40,000+ metres) was conducted over one relatively small part of the property…the zone of sulphide mineralization is open along strike to the northwest toward a known lead deposit as well as along strike to the southeast and downdip…the project is also an ideal candidate for a fast-track to production…the deposit is close to a power line, highway and rail line…a large smelter is located just 300 kilometers away by rail…despite the setback last month, GoldQuest is up 18% since we introduced it to BMR readers last fall at 19.5 cents…

Greencastle Resources (VGN, TSX-V)

Greencastle continues to struggle as the stock tumbled 4.5 cents last week to close at 18.5 cents, just one penny above its lowest closing price for the year…at 18.5 cents, Greencastle’s market cap is just $8.5 million which means the stock is essentially trading at cash value…history shows that whenever this occurs in VGN, a terrific buying opportunity has opened up…it’s interesting to note that the stock’s rising 500-day moving average (SMA) and its 1000-day SMA, which has flattened out, have converged at 17 cents…VGN’s strong underlying fundamental value is clearly shown in the latest financials which were released March 24…as of December 31, Greencastle held $5.1 million in cash and $2.6 million in marketable securities…some of those securities are likely shares in Seafield Resources (SFF, TSX-V) while the company disclosed it held 1,148,000 shares of Evrim Resources Corp. (EVM, TSX-V), formerly Avaranta, which started trading on the Venture Exchange January 25…continued firm oil prices will maintain or increase Greencastle’s monthly cash flow of approximately $130,000 as it receives royalties from heavy crude production at Primate in Saskatchewan…Greencastle tripled in value over a six-week period from late October to early December…since the beginning of January, though, the stock has struggled due mostly to impatient investors frustrated with the lack of news…patience is required here…over the years the successful strategy with Greencastle has been to accumulate on weakness when the stock is near cash value and then sell into strength when something develops…with $8 million in working capital, three Gold properties (including land near Richfield’s Blackwater Project) and monthly cash flow from an oil royalty, it doesn’t take a rocket scientist to figure out that Greencastle offers excellent value at current levels…the long-term chart remains very encouraging with rising 200 and 300-day SMA’s that are in no danger of reversing…it’s also important to note that President and CEO Tony Roodenburg, a large shareholder in VGN, refrained from selling any of his holdings during the late 2010 run-up in the share price…this is different from past bullish in the stock and adds further credence to our view that we haven’t seen the highs in this cycle yet from Greencastle – it’s poised for what we believe could be a massive breakout sometime this year…Pinetree Capital has also accumulated more shares in Greencastle, so there’s every reason to be very optimistic regarding this company’s prospects…investors need to be patient, however, as they often do with Roodenburg’s plays…Greencastle is up 32% since we added it back in to the BMR model portfolio over six months ago…

Adventure Gold (AGE, TSX-V)

Adventure Gold closed the week 3 pennies higher at 65 cents, one cent above its still-rising 50-day moving average (SMA), on light volume…the AGE chart has some similarities to GBB’s chart last year and the rising 100-day SMA, currently at 56 cents, is providing rock-solid support…the 50-day SMA has started to flatten out and will be tested this month…the company released good results from two more holes April 7 from its recently completed Phase 1 drill program at the Pascalis Colombiere Gold Property near Val d’Or…hole #17 intersected four separate zones of mineralization at depths ranging from 6 metres to 187 metres (5.7 g/t Au over 4.3 metres, 4.6 g/t Au over 5.7 metres, 12.9 g/t Au over 8 metres, and 5 g/t Au over 6.1 metres)…hole #16 intersected 5.5 g/t Au over 5.9 metres…results from five more holes are pending…follow-up drilling will commence once all assays have been received and reviewed…a NI-43-101 resource calculation is planned for later this year…AGE’s latest financials, released April 1, show the company with $3 million in working capital at the end of January…AGE runs an efficient operation and knows where to direct its energies…we expect AGE will begin drilling its Granada Extension Property in the near future…results from Gold Bullion reveal exciting potential over the far western portion of GBB’s Preliminary Block Model which supports Adventure Gold’s geological interpretation that it holds part of the western extension of the LONG Bars Zone…we first mentioned Adventure Gold to our readers in an article September 29, just a couple of days following the company’s announcement that it had acquired land at Granada, when the stock was trading in the low 20′s…we officially added AGE to the BMR model portfolio at just 34 cents October 28…Adventure Gold has been around only since late 2007 and we are impressed by the company’s solid portfolio of properties (19 in six strategic areas in Quebec and Ontario)…also of immediate interest is AGE’s partnership with Lake Shore Gold (LSG, TSX) on the Meunier 144 Property where deep drilling is still testing the down plunge extension of Gold zones located at the Timmins and Thunder Creek deposits…the current initial deep drill hole onto the Meunier JV property is continuing and is on track to reach the 2,400 metre target level by the end of this month…if a discovery is made, AGE could explode…

Sidon International (SD, TSX-V)

Volume in Sidon picked up substantially last week as 4.5 million shares changed hands on the CDNX with the stock trading between 5.5 and 7 cents…it closed Friday at 6 cents, leaving it unchanged for the week…there has been no news from the company since March 14 when it announced a proposed private placement at 8 cents and an option to acquire an 80% interest in a 50-square kilometre property adjacent to Canaco’s (CAN, TSX-V) Handeni discovery in Tanzania…Sidon has yet to recover from a sharp drop in early March following disappointing assay results from its Morogoro East Gold Property…the six shallow holes drilled in December at Morogoro East did not produce significant results, the best hole showing 3 metres grading 1.7 g/t Au…the company has drilled four deeper holes with results for those still pending…what the initial six holes have given Sidon, however, is a better understanding of the Morogoro geological structure which will aid in any future drilling…exploration, especially at such an early stage, is never easy and disappointing early results don’t necessarily mean a property doesn’t hold excellent potential…the company is also trying to develop a placer operation at Morogoro…there is certainly hope here for better days ahead for Sidon…from a technical standpoint, previous support between 9 and 10 cents will now provide resistance…the turnaround in the stock price will start once the 50-day SMA has reversed to the upside and that realistically could occur as early as by the end of this month…Sidon is up 20% since we introduced it to BMR readers a year ago at a nickel…the company currently has approximately 140 million shares outstanding for a market cap of $8.4 million…

Seafield Resources (SFF, TSX-V)

Weakness continues in Seafield and the stock seems determined to fill the gap created when it exploded to the upside from 23 cents in early December…SFF closed Friday at 25.5 cents, a loss of four more pennies for the week…it is now below its rising 300-day moving average (SMA) for the first time since late November…the rising 500-day SMA is at 23.5 cents and while we didn’t expect Seafield to drop this low, we’d certainly be shocked if it couldn’t find support in the 23 to 24 cent range…the downside risk from here appears very limited based on technical and fundamental considerations…in otherwords, the risk-reward ratio at the moment is looking extremely attractive with SFF…this is also why we like the warrants that started trading recently (they closed at 6.5 cents Friday) as they provide excellent leverage though one stands the risk of losing most or all of their money in that trade…each warrant entitles the holder to purchase one common share at a price of 75 cents per share and will expire on Friday, Dec. 21, 2012…the company announced April 5 that drilling has commenced at Santa Sofia, about one kilometre north of Dos Quebradas where drilling continues…Seafield geologists have identified a promising porphyry target measuring 1,050 metres in length and 850 metres in width at Santa Sofia with soil values up to 2.3 g/t Au…on March 7, assays were reported from the first three holes completed at Dos Quebradas with hole #2 intersecting a whopping 511 metres grading 0.58 g/t Au…the hole ended in mineralization…hole #1 delivered 269 metres grading 0.37 g/t Au while hole #3 was drilled to define the eastern limit of mineralization and returned no significant results…a total of 10 holes were completed at Dos Quebradas as of early this month…significant intercepts well outside areas of historical drilling would start to get the market excited…the geological case for Seafield’s Quinchia land package is compelling and we’re looking forward to more results from Dos Quebradas as well as initial assays from Santa Sofia…the company has already outlined a NI-43-101 inferred resource of nearly 800,000 ounces at its Miraflores Property, a number that’s expected to increase following the 12-hole, 4,000 metre program completed late last year…patient investors have an opportunity to do extremely well with this play given the geological merits of Quinchia and the real potential for 5 million+ ounces from several potential deposits…the company is sitting on at least $15 million in cash and has a very modest market cap of $39 million…Seafield has gained 325% since we made it the first company in the BMR model portfolio in the summer of 2009…it’s encouraging to see that Anglo-Ashanti Ltd., the world’s third largest Gold producer, plans to spend $300 million over the next three years on further exploration in Colombia…

Gold Bullion Development (GBB, TSX-V)

Gold Bullion was off a penny for the week, closing at 46 cents, and announced a private placement financing after the close Friday which could add as much as $5 million to the company’s treasury…most of the financing is at 61 cents on a flow-through basis which is a departure from previous financings which have all been hard cash…nonetheless, the money is needed as GBB pushes to advance the Granada Gold Property…GBB was up 2.5 cents for the month of April and got as high as 56 cents on a buy recommendation from Doug Casey’s International Speculator…selling pressure, as indicated by the CMF, is at levels not seen since May of last year which we view as a positive contrarian sign…for the past eight weeks Gold Bullion has traded between its 300-day and 500-day moving averages (SMA), a pattern that seems likely to continue for the immediate future until an event or news produces the most likely scenario which we believe is an upside breakout…investor patience is critical here as this opportunity is as big as ever despite the share price slump which started in mid-February…GENIVAR is expected to complete an initial 43-101 resource estimate for the LONG Bars Zone sometime during the third quarter and that should spark significant new interest in GBB…given the obvious multi-million ounce potential of the LONG Bars Zone, the company’s current market cap of $73 million seems absurdly cheap despite a few miss-steps we believe GBB has made that we’ve already identified…more drill results were released April 5…there were no eye-popping numbers but that’s okay – virtually every hole continues to hit near-surface mineralization and tonnage keeps building…hole #179 (72.25 metres grading 1.25 g/t Au and 156 metres of 0.61 g/t Au) shows mineralization continues to push eastward from Pit #1…six holes drilled just NE and SE of #179 under the waste pile will be important to look for (holes #198, #199, #201, #248, #250, and #253 – assays to come)…hole #97 was a nice cut likely of Vein #2, 46.7 metres grading 1.51 g/t Au…holes like #69, #124, #136 and #193 don’t get most investors excited but they’re very important to the overall picture with long intersections of lower grade (177, 113, 189 and 165 metres respectively grading between 0.31 and 0.42 g/t Au)…Frank Basa will have no problem with those numbers, keeping in mind the “upgrading” effect at Granada…structure is there…more bulk sampling and different types of drilling will quantify and improve the grade…just a few holes reported from the southwest corner of the Block Model with many more to come from there – it continues to be a promising area…there were a smattering of holes from the Eastern Extension but nothing that jumped out at us…many more results are yet to come from the Eastern Extension including the northern part where good visuals were reported earlier…it’s interesting to note that on GBB’s drill map, three step-out holes have been drilled about 90 to 145 metres north of holes #55 and #108…we’ll be watching closely for results from those holes…assay results are now in on nearly half of the 228 holes completed so far (45,000 metres) in Phases 2 and 3…47,730 metres in total have been completed since December, 2009…the case for the LONG Bars Zone remains intact…much, much more drilling lies ahead as this is all about volume (which is why we wanted to see more than two rigs by 2011)…the 43-101 this summer will be extremely helpful in terms of pushing this exciting project forward…Gold Bullion is sitting on a potentially huge near-surface Gold deposit in one of the best jurisdictions in the world for mining and exploration during the greatest bull market in history for the yellow metal…on April 11, Gold Bullion announced its intention to spin off its Castle Silver Mine Property into a separate publicly traded company…such a move makes good strategic sense and Gold Bullion is hoping the proposed transaction will be completed before the third quarter of this year…that could be optimistic as this type of move typically runs into unexpected delays but the important point is that GBB is going in the right direction with this important asset…Castle is a significant former producer with a lot of unexplored potential for cobalt and silver, in particular, in addition to nickel and copper…GBB has gained 557% since we introduced it to BMR readers 16 months ago and much more excitement in our view is yet to come from the LONG Bars Zone…

Cadillac Mining (CQX, TSX-V)

Cadillac was unchanged at 17 cents on light volume again last week…the company issued a news release Wednesday, updating drilling progress by partner Visible Gold Mines (VGD, TSX-V) on the Cadillac Break Project that was optioned to VGD last December…two holes have been completed on the Kanasuta claims within 800 metres of Vantex Resources‘ (VAX, TSX-V) Moriss Zone discovery at its Galloway Project in Dassarat township, approximately 30 kilometres west of Rouyn-Noranda…Visible Gold is expected to drill two more holes before moving that rig eastward to ground within 2,800 metres of Richmont Mines’ (RIC, TSX) growing Wasamac deposit…no mention was made in the Cadillac news release of its seven 100% owned claims that are tied on to Wasamac…at the end of February the company announced it was “getting ready” for an exploration program at its Wasa claims and that it expected to announce details of its exploration program in the near future…in our view, Cadillac would be far better off optioning those claims as well to Visible Gold which is in a much better position in every way to aggressively tackle the great potential of that property…Wasamac has helped propel Richmont’s share price to an all-time high of nearly $10…despite our frustration that Cadillac has missed a huge opportunity so far to take advantage of the Wasamac situation, the company’s potential remains exciting given its strategic land package in northwestern Quebec, the astute acquisition of a former Gold-Silver mining camp in Utah, and the tight share structure…the current market cap is only $4.25 million which allows for plenty of upside…management’s challenge is indeed to show that it’s capable of “seizing the moment” and driving shareholder value through opportunities the company has been blessed with…

Abcourt Mines (ABI, TSX-V)

Abcourt was off half a penny for the week, closing at 16.5 cents…a declining 50-day moving average (SMA) has been putting some pressure on the stock which is supported by rising 200 and 300-day SMA’s at 15.5 and 14 cents, respectively…after announcing the closing of a $6.32 million financing April 21, ABI released more drill results last Tuesday from its Abcourt-Barvue Silver-Zinc Property near Val d’Or…the results from five additional holes suggest growing open pit reserves and resources…two zones continue to produce significant grades including 9.1 metres of 171.73 g/t Ag and 3.48% Zn in hole #20 (zone 1) and 7.3 metres grading 196.32 g/t Ag and 3.73% Zn in hole #19 (zone 1)…the 10,000 metre drill program continues…the last set of results from the company’s Elder-Tagami Gold Property near Rouyn-Noranda came out March 3…mineralization continues to expand to the west of the former underground Elder Mine…the Tagami area to the north, meanwhile, has untapped potential including some higher grades…the latest NI-43-101 resource estimate of 216,000 ounces was released in the summer of 2009…the possibility of Abcourt expanding that resource beyond 500,000 ounces certainly exists given the encouraging results to date (look what Richmont has done at Wasamac)…the heavy accumulation that began in Abcourt in December was no fluke in our view…this is a company with significant assets that could justify a substantially higher valuation…nearly 60 million shares of ABI changed hands on the CDNX in December and January – record volume for this stock, accompanied by a price jump from 14.5 cents…we’ve seen these type of volume surges before and they are always a very positive sign…Abcourt is being accumulated, and our best guess is that some savvy players like the assets in the ground…continued drilling success and even higher prices for Gold, Silver and zinc would be exciting developments for this stock which has a history of major moves…from mid-2005 to early 2006, Abcourt rocketed from 15 cents to nearly $1.40…

Currie Rose Resources (CUI, TSX-V)

Given its bullish chart patterns and the pending start of a major drill program at its properties in Tanzania, we consider Currie Rose to be one of our best opportunities for the month of May…the stock closed up a penny last week to 18 cents and remained above its 50-day moving average (SMA) throughout April…the 50-day has flattened out and appears ready to reverse to the upside in the very near future which would be another bullish development in addition to the just completed “cup with handle” formation…we are particularly excited about Currie Rose’s Sekenke Project in northwest Tanzania which we regard as the company’s #1 play as it holds major blue sky potential…Sekenke covers a lot of promising ground and runs in between and surrounds two former high grade Gold mines including one of Tanzania’s original producers…Sekenke will likely be the first target of CUI’s upcoming drill program…while its Tanzanian properties are the market’s major focus, Currie Rose could also benefit over the coming weeks and months from continued good exploration news from Trueclaim Exploration (TRM, TSX-V) which is currently conducting an 8,000 metre drill program at the Scadding Gold Property near Sudbury…Trueclaim, which released encouraging new assay results last week including 10 metres grading 3.5 g/t Au, has earned a 51% interest in Scadding and can acquire a full 100% interest by completing a feasibility study, paying $2 million to Currie Rose, and giving Currie Rose a 3% net smelter royalty…CUI announced a joint-venture deal January 25 with Australian-based Liontown Resources for Currie’s Jubilee Reef Gold Project in Tanzania…CUI’s focus is on the Sekenke and Mabale Hills Projects, so finding a partner for Jubilee Reef made sense…the deal commits Liontown to at least 5,000 metres of drilling at the property this year which will give Currie Rose a minimum of 23,000 metres of drilling at all of its properties in 2011…while Currie Rose has had its market cap shaved considerably, from a high of nearly $40 million to the current $16 million, what hasn’t changed is the quality of this company’s project portfolio which remains as high as it ever was in our view…Currie Rose has all the cash it needs ($2 million) to complete an initial major round of drilling (10,000 metres) this spring and summer in Tanzania, so there will not be any dilution of the stock at current levels as confirmed by President and CEO Harold Smith…

Richfield Ventures (RVC, TSX-V)

Richfield, moving of course in step with New Gold Inc. (NGD, TSX) was up 32 cents last week to close at $9.69…on April 19 it announced more outstanding drill results from its Blackwater Project in central British Columbia including 82 metres grading 3.29 g/t Au over the northern section which is a joint venture with Silver Quest Resources (SQI, TSX-V)…of course at the beginning of April, Richfield announced a plan of arrangement with New Gold for a takeover of Richfield (in NGD stock) valued at that point at $10.38 per RVC share or $550 million…the drop in New Gold’s share price has been a knee-jerk reaction to some potential share dilution without investors properly considering the enormous possible benefits down the road to this company if it were to add Blackwater as a producer…we’ve been speculating on a potential buyout of Richfield for some time now…the proposed deal is certainly a very positive fit for New Gold whose New Afton Project in the interior of British Columbia, not far from Blackwater, is on target to start production by the middle of next year…New Gold sees some obvious synergies between the two deposits…Richfield recently outlined approximately 4 million ounces of Gold in the indicated and inferred categories at Blackwater in a NI-43-101 resource estimate released March 2…will another company step into the picture and start a takeover battle for Richfield?…the possibility of that can’t be ruled out, especially with Gold as strong as it is and the likelihood in the minds of some that the current resource at Blackwater could be expanded significantly…we’re now living in a world where there is a fierce battle for resources of all types…Richfield is up 708% since we introduced it to BMR readers in December, 2009, at $1.20…the Blackwater Gold District is still full of opportunity for investors and we encourage readers to check out the web site, www.BlackwaterGoldDistrict.com…we also see great value in New Gold which has been exceeding analysts’ expectations with terrific numbers…New Gold’s AGM is this coming Wednesday, May 4, when the company will also be releasing its Q1 results and no doubt commenting on the potential benefits of the proposed Richfield acquisition…