Precious metals are strong to begin the new trading week…as of 7:45 am Pacific, Gold is $6 higher at $1,435 while Silver has hit a fresh 31-year high…it’s currently up 64 cents at $38.47…crude oil moved above $108 but is now off a dime at $107.84 while the U.S. Dollar Index is flat at 75.81…there’s no major economic news coming out of the U.S. today after Friday’s bullish jobs report…the European Central Bank is poised to raise interest rates on Thursday…the Bank of England and the Bank of Japan also meet this week…comments by Federal Reserve Presidents will be watched closely this morning…Atlanta Fed President Dennis Lockhart and Chicago Fed President Charles Evans both speak this morning while Fed chairman Ben Bernanke speaks at the Atlanta Fed’s financial markets conference later today…Richfield Ventures (RVC, TSX-V), which BMR introduced to its readers at $1.20 per share in December, 2009, is being taken over by New Gold Inc. (NGD, TSX) in an all-stock transaction valued at $550 million ($10.38 per Richfield share) based on each company’s closing price Friday…Richfield closed Friday at $7.93 and is currently trading at $9.91, up $1.98…it got as high as $10.05…each Richfield shareholder will receive 0.9217 of a New Gold share for each Richfield share held…not surprisingly, New Gold (which has a great looking chart by the way) is initially off slightly on the news (down 43 cents at $10.83) but the deal seems to be a nice fit as New Gold expects to bring its New Afton Gold-Silver-Copper Project near Kamloops, BC, into production by the middle of next year…Richfield released a NI-43-101 resource estimate March 2 for its Blackwater Project in central British Columbia, showing approximately 4 million ounces of Gold in the indicated and inferred categories plus a substantial amount of Silver…this is the type of news that helps to ignite a market…the CDNX is currently up 26 points to 2324 and trading volume has picked up considerably…a close above resistance at 2330 would be a very bullish development for this market…SilverQuest (SQI, TSX-V), which is a 25% joint venture partner with Richfield on the Davidson portion of the Blackwater Project, is up 14 cents to 77 cents…Troymet Exploration (TYE, TSX-V), which announced this morning it has completed its winter drilling program consisting of nine holes at its Key Project which immediately adjoins Blackwater, climbed as high as 32.5 cents but has since pulled back to 27 cents (down 2 pennies)…Greencastle Resources (VGN, TSX-V) holds 13,000 hectares (Nechako Property) near Blackwater and is planning an exploration program for this summer…VGN is up 2 pennies at 25 cents…check out the web site, www.BlackwaterGoldDistrict.com…more good drill results from Wildcat Silver (WS, TSX-V) this morning from its Hermosa Project in Arizona…the company reported four more holes including HDS-112, near the western edge of the current Hermosa resource, which cut 36.6 metres grading 406.5 g/t Ag…three encouraging step-out holes were also released with mineralization remaining open in all directions…Wildcat is 24 cents higher at $2.35…Gold Bullion Development (GBB, TSX-V) is up 1.5 cents at 45 cents…as we’ve seen with Richfield, exciting things can happen when a company releases a 43-101 resource estimate…GBB’s 43-101 for the LONG Bars Zone is expected to be released this summer and we’re confident the number will be impressive given the drill results to date in addition to all the historical information that’s known regarding Granada…Visible Gold Mines (VGD, TSX-V) is up half a penny at 42.5 cents…VGD is rapidly developing into a powerful player in the hunt for Gold in northwestern Quebec…the company is armed with nearly $9 million in cash and is about to launch a drill program on a second property…last Thursday, Visible Gold Mines announced a deal with Agnico-Eagle Mines (AEM, TSX-V) with VGD optioning AEM’s Joutel Property 150 kilometres north of Rouyn-Noranda…Joutel is a former significant producer and gave birth to Agnico-Eagle in the early 1970’s…the fact Agnico-Eagle would cut a deal with Visible Gold Mines on Joutel speaks volumes about the major’s confidence in VGD and its senior geologist, Robert Sansfacon…Sansfacon, who honed his skills for many years with Lac Minerals, is regarded as one of the top geologists in the country and was instrumental in the discovery of Osisko’s (OSK, TSX-V) Canadian Malartic deposit…Visible Gold Mines’ President and CEO is Martin Dallaire, a very successful entrepreneur from Rouyn-Noranda who has a degree in engineering and an impressive game plan for this company to rapidly build shareholder value…Gold Canyon Resources (GCU, TSX-V) is up 33 cents at $3.71 as it busted through important resistance at $3.40…the company has been delivering outstanding drill results from its Sprinpole Project in Ontario…like Richfield, GCU is a “keeper” for potentially much bigger things to come…
April 4, 2011
9 Comments
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Would you be a buyer of GCU at this level?
Comment by GREG H — April 4, 2011 @ 6:58 am
Have been waiting for GCU to pull back under 3 bucks, doesn’t look like that is going to happen now unless there is a big market sell off?
Comment by GREG H — April 4, 2011 @ 6:59 am
Not a chance…..I don’t think it will, especially if the CDNX gets thru 2330. It appears that GCU has an even bigger deposit than Richfield’s Blackwater…..RVC is getting taken out now for $550 million…..that gives you a good idea of the potential value of GCU…great long-term play and short-term possibilities also….
Comment by Jon - BMR — April 4, 2011 @ 7:02 am
yea that’s what I thought, wishful thinking I guess, should have bought more when i had the chance, my life story. lol
Comment by GREG H — April 4, 2011 @ 7:19 am
Hi Jon,
I know EGM/Excel gold mining is not on the BMR portfolio anymore. It hit low of 0.10 cents today. I don’t read good things
about EGM on Stockhouse BB.
Here is one of the poster say;
“I have been trying that number for months .Nobody answers .I have tried some other numbers i have dug up and i get different law firms which tell me they use to be a client of theirs but don’t represent them anymore.Martin harveys phone number won’t let me leave a message. Does this sound like a company that wishes to keep their shareholders informed.Why did we not get our last drill results yet.Shady to say the least.”
Is this a risky play. Can it go lower than 0.10 cents. Should I just take the loss and sell it?
Your opinion is appreciated.
Thanks in advance/Lou
Note: I hold VGN,CQX,CUI,TRM,TYE
Comment by Lou — April 4, 2011 @ 6:58 pm
Hi Lou, Excel took a strange turn last fall when Frank Basa, who would have turned things around at that company, came on board as President and then a short time later resigned. We got an uncomfortable feeling with EGM around that time and dropped it from our model portfolio. I really like the Montauban Project, so there is potential there. In the speculative junior market, one effective strategy I have found – one we’ve mentioned several times on the site – is to exit a position once you’re down 10 or 15%. You can always come back in to that stock at a later date, but you limit your losses. You’re doing more trading this way but at least you drastically limit your chance of ever taking a 50% or more hit on a stock. That’s not the strategy for everyone but it’s something to consider. Even the best investor or trader in the world is not going to be right 100% of the time. Get rid of the dogs early and move on to something else. On the other hand, there are those who like to hold quality situations for the long term, even if they’re temporarily down, and sometimes those are the ones who make a killing on a play. A friend of mine bailed on Richfield last summer at around $1.20 and he’s kicking himself now. VGN, CQX, CUI, TRM and TYE are solid situations IMHO. This is not investment advice as to what you should do, just personal observations.
Comment by Jon - BMR — April 4, 2011 @ 7:18 pm
Thank you Jon,
Your quick response and opinion much appreciated. It’s been almost a year now since I bump into BMR website which I read everyday and I must admit that I made money through BMR portfolio stocks. Thanks again. Have a good day.
Comment by Lou — April 4, 2011 @ 7:49 pm
For all you technical analysts out there – The Dow broke through its all time high yesterday indicating a dow theory buy signal. A close of 1333 on the S&P500 would signal a buy in the markets. There’s also additional strength in the CDNX which supports this buy. As Jon indicates a break above 2330 on the CDNX would confirm a buy in the markets.
On April 4th, SFF established a continuition wedge formation which is an intermediate bullish pattern. Target based on the breakout is around 0.78-0.88.
VGD has made a symmetrical continuation triangle pattern on April 1st…with targets around 0.60 – 0.64. Also yesterday it created a bottom triangle which is intermediate bullish with a target at 0.55-0.59
VGN on March 25st established a continuation wedge formation (intermediate bullish). Target 0.45-0.51.
All parterns were confirmed using the technical analysis from TD Waterhouse.
Comment by Andrew M — April 5, 2011 @ 7:00 am
Thanks Andrew for sharing your work! I’ve been waiting for Jon to post the “roll back shopping list” – hopefully today as everything is looking so much more positive. I’m in a cash position but trading to keep ahead of what I miss on the BMR Portfolio. Good to finally see some news this morning from SFF. Maybe GQC will be out soon. Enjoy the day.
Comment by Andrew — April 5, 2011 @ 7:08 am