Gold has touched a 6-week high today, thanks to yesterday’s dovish Fed minutes…the yellow metal has traded between $1,144 and $1,161 so far today (near-term resistance at $1,160)…as of 9:00 am Pacific, bullion is up $20 an ounce at $1,159…Silver has jumped 20 cents to $15.86…Copper has surged 7 cents to $2.40…Crude Oil, set for its biggest weekly rise since 2009, has added another 39 cents a barrel to $49.82 while the U.S. Dollar Index is under pressure again, down nearly half a point at 94.86…technical conditions continue to deteriorate in the greenback, and that’s good news for the Venture and commodities…
Yesterday’s Fed minutes from the September 16-17 meeting showed that officials were concerned that negative international developments might have increased the risks to the U.S. growth and inflation outlook, as the committee agreed last month to wait for further economic evidence before raising interest rates…last Friday’s much weaker than expected U.S. jobs report, and other data this week, have no doubt confirmed those concerns…the Fed is not likely going to be able to raise interest rates until the spring of next year at the earliest…
UBS looks for Gold prices to rebound into next year as real interest rates remain subdued compared to past cycles, maintaining its call for the metal to average $1,250 an ounce in 2016. “We think that Gold has already done a lot to adjust to the current macro environment…we anticipate any downside from here to be ultimately contained,” UBS stated in a fresh outlook released this morning…
Zinc Enjoys Biggest Single-Day Advance In More Than 4 Years
Cuts to the supply of Zinc by Glencore are leading base metals higher today, including Copper which has recently seen a number of positive announcements on supply curtailments…Swiss-based Glencore said today that it will make production cuts to Zinc mining equivalent to 4% of the global market…that has sent Zinc prices to a 1-month high and has taken other base metals with it…
Glencore’s cuts in Australia, South America and Kazakhstan will remove 500,000 tons a year from mined supply, potentially tipping the market into a deficit and giving a boost to prices of the multi-purpose metal…Glencore’s announcement comes almost immediately on the heels of a prediction by Goldman Sachs that refined Zinc supply will outpace demand by 50,000 metric tons this year and 51,000 tons in 2016…Goldman will have go back to the drawing board again…too bad…
In today’s Morning Musings…
1. Confirmed Venture and Crude Oil breakouts – updated charts…
2. Garibaldi Resources (GGI, TSX-V) announces mobilization for drilling – our map shows general target area…
3. Shift in Sheslay district dynamics – Doubleview Capital (DBV, TSX-V) in new position of strength…
4. Updated charts for Equitas Resources (EQT, TSX-V), Pure Energy Minerals (PE, TSX-V) and Integra Gold (ICG, TSX-V)…
5. Bottom-fishing opportunity in diamond play…
Plus more…to view the rest of today’s Morning Musings, login with your username and password, or click here to gain full access to this and other exclusive BMR content and features…
Does anyone have any insight on WRR? I think it is supposed to be drilling now but low volume and no sizzle? I expected more from this one.
Comment by Hugh — October 9, 2015 @ 9:22 am
I am very surprised that with all the publicity received from Sheslay (since three months) of an eminent discovery that buyers do not point!
Comment by Guy Delisle — October 9, 2015 @ 9:27 am
Hugh I spoke with Michel David yesterday, we have a contractor delay, drilling soon !
Comment by Guy Delisle — October 9, 2015 @ 9:49 am
Guy- this market is difficult and there isn’t much speculation in it right now…..its dead. Once a discovery happens people will see how fast money was made and speculators will come back to the sector. This market is a “show me first” and not one that speculates but his will change…..the want proof! EQT is a good sign that the sentiment is changing and some speculation is finally returning.
The good old days for the juniors will come back……so far its looking good for a come back….gold heading higher, TSX-V bouncing and heading higher and a discovery by a junior will redirect money back to juniors……EQT, GGI and DBV have a shot of igniting the sector soon!
Comment by DDD4 — October 9, 2015 @ 9:54 am
TomUK – you are correct in the Mexico property of GGI. This could generate revenue and keep GGI from having to do any finances.
Comment by dave — October 9, 2015 @ 10:17 am
“geophysical and geochemical anomalies extending at least 5 km north-south and 5 km east-west” At least 😉 !!
Comment by Martin — October 9, 2015 @ 10:33 am
Has DBV enough money to do much once they get court clearance, or will they have to do a placement at these low levels?
Comment by PaulH — October 9, 2015 @ 10:48 am
Paul, hopefully Dbv get a substantial settlement for damages caused
Comment by Sameer — October 9, 2015 @ 10:54 am
EQT – Hearing Wednesday or Thursday. Hardy is waiting for a fund and giving them till Tuesday to hand over the money, or he will start closing procedure on the PP.
Comment by dave — October 9, 2015 @ 11:01 am
DDD4 – Reference DBV, I’m hoping to snake you and get in lower than .09 – hahahahaha
Comment by dave — October 9, 2015 @ 11:03 am
PaulH , with the legal costs that have occurred look for a pp in order for DBV to continue with much more drilling , hopefully they can get the share price up before they have to raise cash.
Comment by Les — October 9, 2015 @ 11:08 am
Are the legal costs actually that high? I’m UK based so have no idea what is involved in getting an injunction against an individual.
DBV have the results of 3 holes (2 partial) in order to get the SP up. If our expectations are proven correct then the SP should fly up.
Comment by Tom UK — October 9, 2015 @ 11:49 am
Dave- don’t forget that I have been in DBV for a few years now and have bought plenty between .05 and .10!
Anyways, there is no way that you can accumulate as many shares as I have (975.5k) below my average cost of .12….if you can that means I’m in trouble and not going to be able to start the SVMC….lol.
Comment by DDD4 — October 9, 2015 @ 11:53 am
DBV- I know for fact that they intend to do a PP to get enough funds to aggressively drill and make up for lost time. They intend on having more than 1 drill rig at some point. I also heard that there are deep pockets that want in on the next PP if DBV and them can agree on the terms/conditions.
Knowing Farshad and how he operates, he will do everything in his power to minimize dilution……he has demonstrated this in the past and cares for shareholder value! He has managed to raise money in the worst of times and even went to the extreme of remortgaging his house to help drill……he has a large family to support so it must have been a difficult decision to make but he supported the company. I’m sure that he believes his family’s success/well being relies on what’s below the surface at the HAT!
I don’t expect a PP to occur at these low prices. DBV still has some ammunition to raise the stock price to minimize dilution. They still have the remainder of H23 and H24 which was completed before Chris and his buddies crashed the party! Once they start drilling and have a favorable court decision I’m sure that alone will move the stock price above where it was before the party crashers arrived!
Comment by DDD4 — October 9, 2015 @ 12:11 pm
But chad day will have to pay for our court costs plus for damages. That way we don’t have to do another PP right away?
Comment by Sameer — October 9, 2015 @ 1:08 pm
Nice position D4 🙂
Comment by Martin — October 9, 2015 @ 1:12 pm
DBV- No I don’t think it will be right away. Again Farsad will most likly wait to play his cards first to get a more favourable PP and one which is less dilutive. The goal will probably be to do one in time to maintain momentum and no break in drilling imo.
No worries…..we are in good hands and we have a highly specialized team which is eager to uncover what they think they have in the ground.
Comment by DDD4 — October 9, 2015 @ 1:48 pm
Martin- my position is small compared to my buddy who holds 2.5 times more shares at an average price lower than mine! He reads BMR daily but rarely posts.
Comment by DDD4 — October 9, 2015 @ 1:53 pm
Nice you guys hold about 5%, average price is secondary, is the end result that will be beneficial, I hold about 1/7 of your DBV position in GGI, will have to trade and add but could join your sdmc at some point lol
Comment by Martin — October 9, 2015 @ 2:25 pm
EQT wow. That was another great day! Bring on next week!
I’m hearing the fund that was sling their position on FAS.V should be just about done. 8M shares have traded last 3 days all around .10. I started my position today. Do some dd on FAS. Interesting space with huge upside from here imo. Cheers
Comment by BigRig — October 9, 2015 @ 2:30 pm
Wow DDD4, that is heavy position. You going for millionaire status on that one. Are you thinking of adopting an old man – Hahahahaha.
Comment by dave — October 9, 2015 @ 3:18 pm
That’s why I will stand up the SVMC in 2016! Once its stood up we will do a meet and greet somewhere to celebrate…..
Comment by DDD4 — October 9, 2015 @ 3:40 pm
cant wait for beer and wings:)
Comment by Jeremy — October 9, 2015 @ 3:55 pm
Drilling area 3 is interesting, as I would have thought area 1 first based on the historical data. Wonder what they uncovered there? In any event, it is going to be exciting. We now have drills going on both EQT and GGI and two potential massive discoveries, one on the east coast and one on the west coast. What a wonder time of the year!
Comment by Dan1 — October 9, 2015 @ 3:59 pm
We are heading into the second week of October and GGI isn’t set up presently with a winter camp. BMR has talked about being able to set up a winter camp in short order if the first round of drilling goes well. Does any one here have a idea of how many drill holes can be put down in the little time they have left before the snow flies, and how deep would they have to be before the decision is made regarding staying on through the winter. Wishing every poster has a great thanksgiving this weekend.
Comment by simone — October 9, 2015 @ 4:54 pm
Simone, it remains nice and mild up in the Sheslay district at the moment, +10 (50 fahrenheit) tonight (7 pm BC time) as I write this, actually, and the 14-day forecast looks just fine. In 2013, Farshad drilled into mid-November with no winter camp until an early harsh arctic blast set in at that time. So I would say GGI has at least 3 weeks to drill their brains out before they have to start making decisions on winterizing their camp. The most intense El Nino in at least 20 years has formed in the Pacific, and that typically brings warmer than usual fall/winter weather to British Columbia. So that could be an advantage for GGI in terms of extending the period for a non-winter camp. Keep in mind, also, the Sheslay district is protected by the mountains to the west and receives much less snowfall than areas even 30 or 40 miles to the south. In some ways, however, drilling in the winter would be easier for GGI given the extent of boggy areas at Grizzly Central, and the fact they would freeze over.
Not to put their geologists under any pressure, but given the historical drill hole success ratio in the district, the fact that DBV made a major discovery on the 8th hole in late 2013 with far less knowledge of the district at the time, and GGI has a “roadmap” of 50 drill holes over the last 2 years in this corridor to match up with the geological, geophysical and geochemical signatures of Grizzly Central – it would be surprising if they weren’t able to make a discovery within the first 4 holes. This is as good as it gets in the industry in terms of the probability of drilling success on a grassroots project.
Comment by Jon - BMR — October 9, 2015 @ 5:59 pm
I am no expert, but I can’t see any reason why GGI would drill into the winter. Unless it is a boggy spot like you mention Jon, it would seem alot of extra work and unpleasant conditions to carry on into winter. We speculators would love continous action, especially if they get promising results, but it would be impractical and unnecessary for the company.
Comment by PaulH — October 9, 2015 @ 6:20 pm
Think you’re right Dan, they are heading for area 3??? Tough they would go for the north body. Could be a mistake in the press release should read north western part, I don’t know??
Comment by Martin — October 9, 2015 @ 6:30 pm
I the video area 3 is part of grizzly central circle and is far western side “The first holes will focus on one of a series of high-value target areas identified along the far western side of Grizzly Central”
Comment by Martin — October 9, 2015 @ 6:41 pm
It’s also very close to the camp
Comment by Martin — October 9, 2015 @ 6:43 pm
Paul, let me clarify a few things for you.
First, if GGI hits a hole at Grizzly Central, a legitimate discovery, they will have EVERY reason to continue drilling because the market – starving for a discovery somewhere – will demand it (the stock will go crazy, they will be offered all sorts of financing opportunities), AND it’s much cheaper to simply continue drilling than de-mobilizing and re-mobilizing later on.
Second, too many readers here seem to think the Sheslay district is in the North Pole. I’ve been there. I got a suntan in April. The climate during the winter in the district cannot be described as “harsh”. Snowfall is limited due to the “rain shadow” effect of the mountains to the west. Farshad would be the first to say this – it’s a very unusual climate in the Sheslay Valley. Yes, you can get an arctic blast for a few weeks where it can get quite bone-chilling, but drilling throughout the winter there is no problem whatsoever – except the cost is about 20% more.
Third, in the case of Grizzly Central as we’ve pointed out on many occasions, you have a lot of boggy areas there. Over the years, GGI has found it actually easier sometimes to carry out work during the winter over this part of their property, which is relatively flat-lying and at an elevation of approx. 1000 meters. In fact, they were doing important geochemical sampling in February of this year. In February – the heart of winter. Does that not tell you something????
I would argue they are starting drilling at Grizzly Central at the most ideal time —— those boggy areas will become increasingly more accessible going into winter. Bring on the cold. Put on the warm clothes and go at it.
Comment by Jon - BMR — October 9, 2015 @ 6:48 pm
What do you think of area 3 Jon as a first drill area
Comment by Martin — October 9, 2015 @ 7:04 pm
Will comment more on this over the weekend, Martin, but in short the mag lows surrounding it are EXTREMELY interesting. And then within this area, we know they have subdued to high mag readings with coincident geochemical anomalies. Perhaps also some limited outcrop that has given them some valuable clues. Interestingly, it’s also right on trend with the Kaketsa “heat engine”. What we don’t know at this time might be the final piece of the puzzle that has convinced GGI to start here – IP. I’d be surprised if they haven’t carried out IP over this area. There could be something from an IP that we’re obviously not aware of at the moment that has really jumped out at them. You combine IP with mag data and geochem, and geological structure – and you have the right mix there, kaboom, in this district you have a discovery.
Comment by Jon - BMR — October 9, 2015 @ 7:12 pm
Winterized the camp is not a problem, what is important it is be sure that water don’t freeze for the rigs !
Comment by Guy Delisle — October 9, 2015 @ 7:14 pm
You’re right, Guy – that’s where a good proportion of the extra costs come in. You have to make sure the hoses don’t freeze up.
Comment by Jon - BMR — October 9, 2015 @ 7:20 pm
Thanks for the detailed explanation Jon. Let’s hope, I have plenty of GGI shares that need to earn their keep!
Comment by PaulH — October 9, 2015 @ 9:43 pm
It’s a lot easier to make an ice road than to build a dirt road.
I work the oilfields in Alberta.
Things get busier once the ground is frozen up.
Build roads over muskeg that’s totally impassable when it’s warm.
Bring on the cold!
Comment by Geraldgallant — October 10, 2015 @ 5:33 am
I think they are going for the edge of the caldera that Regoci as mention 2 or 3 years ago https://en.wikipedia.org/wiki/Caldera
Comment by Martin — October 10, 2015 @ 11:12 am
Jon do you think Regoci will make news when it will begin drilled !
Comment by Guy Delisle — October 10, 2015 @ 2:39 pm
Normally that’s what any company would do, Guy. My gut feeling is that Friday’s news was the “scene-setter”, the “pre-game show” so to speak, and they probably also have quite of bit of new data to release to back up their selection of this particular target area. So Regoci not only has a great target, but he’s showing he knows how to build momentum. I believe this continues to ramp up next week. GGI surprised us with Friday morning news during trading, which is something I can’t recall them doing before, so who knows what other surprises Regoci has up his sleeve.
Comment by Jon - BMR — October 10, 2015 @ 3:11 pm
Happy Turkey Day to all you Canadians: gobble gobble.
Comment by dave — October 10, 2015 @ 6:20 pm
Sameer, #15. One would have about as good a chance getting money out of Chad Day as one could get water out of a stone. The most important part of the coming court decision will be a restraining order keeping Chad and his followers off of DBV property. Their are lots of backers with deep pockets that will take DBV to the finish line.
Comment by Les — October 10, 2015 @ 9:14 pm
Garibaldi have assays pending from Rodadero since early this year. La Patilla results are also due out. Maybe Regoci will release these as part of the NR momentum after drilling has started.
Comment by Tom UK — October 11, 2015 @ 12:04 am
You are correct Les. Court proceedings and lawsuits can take months, sometimes years to reach a settlement regarding money. No doubt GGI will be back on the property fairly quickly but not with Chad Day funds.
Comment by Dan — October 11, 2015 @ 4:22 am
I assume you mean DBV and not GGI Dan.
Comment by Tom UK — October 11, 2015 @ 6:10 am
Yes meant DBV Tom.
Comment by Dan — October 11, 2015 @ 7:47 am