Gold is taking a bit of a breather this morning…as of 7:15 am Pacific, the yellow metal is off $8 an ounce at $1,518 after briefly climbing above $1,530 overnight…Silver is down 93 cents at $36.97, crude oil is off slightly at $101.15 while the U.S. Dollar Index has fallen nearly half a point at 75.56…G8 leaders have gathered in France for a discussion of a wide range of issues, not the least of which (formally and informally) will no doubt be the recently departed IMF leader who’s currently under house arrest…new U.S. claims for unemployment benefits unexpectedly climbed to 424,000 last week from a revised 414,000 in the prior week, pointing to a painfully slow improvement in the nation’s job markets…meanwhile, surging gasoline prices and sharp cutbacks in government spending caused the U.S. economy to grow only weakly in the first three months of the year…consumer spending slowed even more than previously estimated…the Commerce Department reported this morning that the overall economy grew at an annual rate of 1.8% in the January-March quarter…that was the same as the government’s first estimate a month ago…consumer spending grew at just half the rate of the previous quarter and a surge in imports widened the U.S. trade deficit…the CDNX, which is up another 5 points to 2054 after the first 45 minutes of trading this morning, is looking much healthier from a technical standpoint right now and it seems highly likely a major reversal is underway after the Index dropped as low as 1957 last week…June, therefore, looks like it could be quite a positive month after declines of 4% in March, 2% in April and 9% so far in May…the similarities with the 2005 March-April-May correction are stunning…in the current market, expect the more established exploration plays to lead the CDNX higher at first…by that we mean companies that are well-financed with developed projects that have 43-101 resources or 43-101’s in progress, such as Gold Bullion Development (GBB, TSX-V)…there will be exceptions, of course, and adding fuel to the any CDNX move will be news of fresh discoveries or potential discoveries…in the case of GBB, it’s clear to us that the stock – technically and fundamentally – has found an important bottom in the mid-30’s and another great opportunity has opened up in this play…other situations (outside the BMR model portfolio) we believe are worthy of our readers’ consideration and due diligence include Levon Resources (LVN, TSX-V), Gold Canyon Resources (GCU, TSX-V), Spanish Mountain Gold (SPA, TSX-V), Silver Quest Resources (SQI, TSX-V), Prodigy Gold (PDG, TSX-V), Golden Predator Corp. (GPD, TSX-V), Probe Mines (PRB, TSX-V), Wildcat Silver (WS, TSX-V) and Hinterland Metals (HMI, TSX-V)…we’ll be going into more detail on some of those situations in the coming days and we’ll have others to add as well…outside the resource sphere, we continue to like iSign Media Solutions (ISD, TSX-V) which is trading within a symmetrical triangle with a breakout to the upside possible in the near future…Silver Quest, of course, holds a 25% interest in the northern portion of Richfield’s (RVC, TSX-V) Blackwater deposit in central British Columbia…some excellent drill results have been coming in from that northern section of Blackwater which continues to develop nicely as a multi-million ounce Gold deposit with Silver and copper values as well…New Gold Inc. (NGD, TSX) is scheduled to complete its acquisition of Richfield before the end of June…as John outlines below, Richfield’s chart is looking very bullish which we believe is also a good omen for this market…
As of 7:15 am Pacific, Richfield is down a nickel at $8.75…as we mentioned yesterday, we continue to be very excited about the prospects for Richmont Mines (RIC, TSX) which is expected to produce approximately 80,000 ounces of Gold this year from its Beaufor and Island Gold Mines in northwest Quebec…Richmont has only 31.6 million shares outstanding, approximately $50 million in cash, no debt and no hedging contracts…first quarter earnings came in at a robust 28 cents per share…technically and fundamentally, we see a strong case for a 50% move in Richmont over the next couple of months if this Gold rally really starts to take off…of course Richmont continues to aggressively drill Wasamac which is a property we are extremely bullish about…the RIC chart is phenomenal…Richmont is currently down 23 cents at $8.03…a less expensive but more speculative opportunity is Currie Rose Resources (CUI, TSX-V)…CUI’s Sekenke Project in Tanzania has enormous potential given its proximity to two former producing high-grade mines and the ground work that has already been completed…Currie Rose will soon be drilling Sekenke for the first time…CUI is currently up half a penny at 17.5 cents…Abcourt Mines (ABI, TSX-V) released more positive results from its Abcourt-Barvue Silver-Zinc Property yesterday…while the market doesn’t really see it yet, Abcourt appears to be significantly upgrading and increasing existing resources and reserves at this property…the same holds true for the Elder-Tagami Gold Property near Rouyn-Noranda…ABI is currently off half a penny at 12.5 cents…
Notice how since Tony Rottenburg has left SFF, that they come out with great news/results and the share price has rebounded? Since Tony Rottenburg is now SUPPOSEDLY focusing all his attention at VGN, they announce NOTHING, they have NO PLANS GOING FORWARD and the share price goes NOWHERE? Anyone else see the irony here? Sure Mr.Rottenurg talks a good game such as,” we might do this, we’ll look at that when the time is right”, WHEN is the time RIGHT??? Rottenburg LACKS EVERY QUALITY ( in my opinion ofcourse) that a good operator should have. He is more concerned with the monthly oil income, so HE can get paid!!! I have spoken to him on a few occasions and the impression that I got is the he thinks that he is better than everyone else, he does NOT have to explain his actions to share holders, he thinks he is in the same caregory a a Peter Munk, Tony is a TOTL clown when it comes to dealing with share holders questions and concerns, PERIOD!! What has McKay accomplished since they were hired at a rate of $ 5000.00 per month?? SQUAT!! It is very WISE to stay away from ANYTHING associated with Mr. Rottenburg. In my opinion he CANNOT GET THE JOB DONE!!! Why else was he PUSHED OUT of SFF?? And dont believe for a minute the he left on his own!!
Comment by john — May 26, 2011 @ 7:38 am
Hi Jon, I was wondering what your thoughts were on GAX? You briefly mentioned this stock back when they announced initial results from the first round of drilling on their Regcourt property….high grade results. Since then they have completed a second round of drilling….13 holes I believe with assays pending. The placement of those holes were based on some pretty impressive downhole IP results from which there were multiple potential sulphide bodies identified that were missed by the first round of drilling. The geophysics revealed a fairly large anomoly which they barely clipped and results from that anomoly were gold bearing.
Thanks, Dan
Comment by Dan — May 26, 2011 @ 2:09 pm
What do you think of OSK’s interest as in the adanac property and the recent news from THG? This obviously lends credibility to the area and THG is essentially riding GBB’s coat-tails getting this sort of interest. Hope theres no premature buyout coming. Would OSK not want to wait for a 43-101 at the very least to make an offer if they did?
Comment by Jeff — May 26, 2011 @ 2:12 pm
Any thoughts on AGE price is now a good time to get in
Comment by bigdave — May 26, 2011 @ 3:30 pm
Jeff, obviously this is bullish for THG AND bullish for GBB – if Osisko has this kind of interest in the Adanac Property, there’s no question they are paying VERY, VERY close attention to Granada……….more on this in the morning and over the weekend……..
Comment by Jon - BMR — May 26, 2011 @ 9:05 pm
AGE had been humming along really nicely until recently when some technical weakness started to settle in…….it’s testing support at the 200-day SMA…..I believe it’s reasonable to suggest there could potentially be a drop down to the mid-30’s (worst-case scenario) where there is exceptional technical support……if you’re a long-term player, the current price is attractive based on the fundamentals….we really like the play…….if you’re looking for a short-term trading opportunity, there are probably other better options at the moment – stocks with stronger technicals……I wouldn’t want to see the 100-day SMA roll over here – I really don’t think that will happen but it’s possible…..
Comment by Jon - BMR — May 26, 2011 @ 9:14 pm
To be honest, i’ve been peeping as we moved along. Now that the truth has been
told, i have to state that the mention by BMR of SQI was enough to bring me back.
I have been in & out of SQI for an extended period of time & now is the time to
hold once more. They were recently written up with a one-year price target of $1.30,
but because of their connection with Richfield & because of Richfield’s connection
with New Gold & because their deal is supposed to be finalized this coming Monday, the
suspense is building, as to what kind of a deal New Gold has for SQI. Stand by & if
yesterday’s trading is an indication, it will be worth standing by for.
r !
Bert
Comment by Bert Coish — May 27, 2011 @ 3:03 am
BMR
What is your opinion on this joe dwek, mineral fields, you hear alot about this guy and his company,I guess I do not understand what it is they actually do to make money, they invest or finance these small companies, and then they gradually sell off their shares every time the stock tries to rally in price, abcourt, trueclaim, and there are many others, alot of investors out there say stay away from any company that these guys are involved in. Can you please explain what you know of these guys?
thx
Comment by GREG — May 27, 2011 @ 7:09 am
I’ve never spoken with them directly before, however I’ve heard both good and bad, more bad to be quite honest………mineralfields has a tendency to dump stock into the market and the threat or perception of that scares off a lot of investors…..their heavy investment in a company is an issue, particularly if the share price is above their entry point….
Comment by Jon - BMR — May 27, 2011 @ 8:11 am