Gold dipped as low as $1,180 early this morning but has recovered to $1,197 as of 6:50 am Pacific after briefly climbing back above $1,200…Silver is 29 cents higher at $18.91…Copper is up 2 pennies at $3.05…Crude Oil is up 32 cents at $97.37 while the U.S. Dollar Index is flat at 82.96…a note to our readers: Monday of course is “Canada Day”…our regular “Week In Review And A Look Ahead” will be posted tomorrow, and there will be no postings Sunday or Monday…regular postings resume Tuesday and will continue uninterrupted next week despite the U.S. holiday Thursday…
Unlike the big sell-off that occurred in April, physical demand for Gold hasn’t shown up in recent days which could lend support to the yellow metal…Gold is now down about 30% this year with most of those losses during this second quarter which of course comes to a close today…with a 25% decline, this is believed to be Gold’s worst quarterly performance since at least 1920…holdings of the SPDR Gold Trust, the world’s largest exchange-traded Gold fund, stood unchanged yesterday after posting their second-biggest percentage drop in holdings this year on Tuesday – down 1.7% or 16.23 tons – to their lowest levels in more than four years…
Nonetheless, when y0u see a headline at www.CNBC.com as posted this morning – “Gold Crashes Through Production Cost Levels” – you know instinctively that a turnaround is probably not far off…as we showed yesterday with John’s long-term chart, there is exceptional support right around the $1,100 level…what would actually be positive to see is a capitulation move very soon down to that area, followed by a sharp reversal…who knows how this will play out, but the bearish sentiment now is the mirror image of the euphoria in September 2011…that’s a bullish scenario…most investors would be very happy getting in on an investment within 10% or 20% of the bottom, and that’s probably the situation with Gold right now…the Fib. targets are between $900 and $1,100…significant mine supply will come off the market if Gold trades below $1,200 an ounce for an extended period, and that will ultimately be price-supportive…this is a great time to be stepping into Gold – when no one wants it…
Today’s Markets
Japan’s Nikkei average soared 454 points or 3.5% overnight to close the month at 13677…for that quarter, that was a 10% gain…China’s Shanghai Composite jumped 1.5% overnight but still finished down 11.5% for the quarter at 1979…European shares are down moderately in late trading overseas…as of 6:50 am Pacific, the Dow is off 93 points at 14931…buy-and-hold billionaire Ron Baron told CNBC this morning that former Treasury Secretary Tim Geithner said at an event he attended that the Federal Reserve’s exit strategy would take about five years…the chairman and CEO of Baron Capital said in a “Squawk Box” interview that he interpreted Geithner’s comments to mean the tapering of the Fed’s $85 billion-a-month bond-buying program would last that long…the TSX has added 11 points in early trading while the Venture, which has so far held important support at 860, is currently up 2 points at 862…Eagle Hill Exploration Corp. (EAG, TSX-V) is one of the most active stocks this morning after announcing that it has entered into a binding agreement to acquire the remaining 25% ownership of the Windfall Lake Property from Noront Resources Ltd. (NOT, TSX-V)…the company has also entered into financing agreements with Southern Arc Minerals Inc. (SA, TSX-V) and Dundee Corp. to provide a total of $12-million through two private placements of units at 7.5 cents per unit…EAG is up 1.5 cents to 8.5 cents on those positive developments…
Copper and CRB Index Chart Updates
Charts show that both Copper and the CRB Index are still vulnerable to additional weakness but both are close to important support levels – $2.90 to $3.00 for Copper, and 267 for the CRB Index (the July 2012 low) which closed yesterday at 277…
Copper 2.5-Year Weekly Chart
CRB Index 5-Year Weekly Chart
Special Update: Garibaldi Resources (GGI, TSX-V) & The Emerging Telegraph Creek Play
As most readers know, we recently had our boots on the ground in the Iskut River region of British Columbia where Colorado Resources (CXO, TSX-V) has made an important Copper-Gold discovery. North ROK is very much for real – CXO has a great opportunity to uncover a major deposit.
What most investors haven’t caught on to yet, however, is what’s brewing about 60 miles to the west-northwest in B.C.’s and Canada’s next red-hot exploration camp – the Telegraph Creek area. In addition to our trip, we have spoken with numerous geologists, prospectors and company officials over the last several weeks as part of an exhaustive due diligence effort to ensure that our information and conclusions are accurate. We will be reporting much more on this in July, but below are a few initial highlights:
When it starts trading this summer, Peter Bernier’s Prosper Gold will draw plenty of attention – no matter what the markets are doing (PGX.H has cut a deal with FTR to acquire up to 80% of the Copper Creek Property). But one way to play this deal NOW (besides FTR) and get ahead of the anticipated August stampede is through Garibaldi Resources (GGI, TSX-V). Why, you ask? Well, the large scale Copper-Gold alkalic porphyry system that Bernier and his highly respected group are going after at the 7,000-hectare Copper Creek Property almost certainly extends to the south onto Garibaldi’s 17,000-hectare Grizzly Property. In fact, the “heat engine” for the mineralization in this entire area may indeed originate on the Grizzly Property with a large intrusive body – Mount Kaketsa – in the northwest corner.
- Size does matter, and Copper Creek and Grizzly are a combined 240 sq. km (North ROK, by comparison, is about 50 sq. km);
- Drill permits are already in place for Copper Creek and Bernier’s group is ready to hit the ground running as soon as final approval for Prosper Gold’s qualifying transaction is approved by the Venture Exchange;
- Bernier has assembled the same team that he had with Richfield Ventures which made the massive Gold-Silver discovery at Blackwater (New Gold Inc. bought out Richfield in 2011 for over half a billion dollars);
- Copper Creek features widespread copper oxides near-surface, underlain by significantly higher grade Copper-Gold values in sulphide mineralization at depth. Firesteel got very encouraging results from about two dozen relatively shallow drill holes, many of which ended in good mineralization. All zones are open in every direction, including at depth. Prospectors and geologists have told us that some of the showings at surface are eye-popping – extensive outcropping in areas featuring azurite, malachite, pyrite, pyrrhotite, and a variety of other (as yet unknown) sulphides. Firesteel spent $4 million on this project since 2004 but didn’t have the kind of technical team necessary to prove up a major deposit – Prosper Gold has that team.
- Garibaldi’s Grizzly Property, or at least a portion of it, will be essential to Bernier’s plans for the area, according to various knowledgeable individuals we’ve spoken to that understand both properties well;
- In 2006, Garibaldi completed an airborne magnetic survey over both Copper Creek and Grizzly, and the results were stunning as described in a technical report available on Garibaldi’s web site:
“For comparative purposes this survey covered the southern part of Firesteel’s Copper Creek Property…Results of the airborne magnetic survey showed that the rock units and structures which underlie the Copper Creek prospects appear to continue into the large area of low relief within the Garibaldi claims and identified several magnetic anomalies which are similar to the magnetic anomalies that are associated with the mineralized zones which comprise the Copper Creek Property; this area is referred to as the “South Target”. During 2007 and 2008 Garibaldi completed orientation soil geochemical surveys which reportedly returned copper values within the anomalous range determined by Firesteel for the Copper Creek property, however the surveys only covered a small fraction of the prospective area and will need to be expanded to cover the area of interest defined by the airborne magnetic survey.”
Below is a 3D perspective of the Copper Creek – Grizzly properties (we’ve added a star to show the large intrusive body that could be driving the fluids in this area):
Garibaldi closed yesterday (June 27) at 5 cents for a market capitalization of only $2.87 million. GGI has 57.4 million shares outstanding and no warrants. All stock options (4.3 million) are at 20 cents or higher. As of April 30, the company had over 8 cents ($4.8 million) in working capital.
Garibaldi has considerable assets in Mexico which they have been focusing on. However, the situation with Prosper Gold and Copper Creek has caught their attention, and it’s safe to assume that Bernier has “introduced” himself to Garibaldi as the newest member of the neighborhood – and the most important one to ever move in. “We got luckier than a drill hole,” Garibaldi President and CEO Steve Regoci told me. Regoci has a solid team himself at GGI and we expect them to be able to fully capitalize on this unique opportunity.
Our prediction: This play will light up like a Christmas tree beginning in just a few weeks as Bernier tackles Copper Creek aggressively in Blackwater-style fashion.
The type of market we’re in right now, with Gold having fallen to $1,200 an ounce and the Venture sitting at levels not seen since just after the 2008 Crash, is one that always provides historic opportunities, and we’re seeing those in what’s unfolding at the moment in northern B.C. Given the previous success of Bernier’s group, and all that we know about Copper Creek, we have an exceptionally high level of confidence that Prosper Gold will execute this opportunity with incredible precision and skill, just as they did with Blackwater. This in turn should create a company-changing dynamic for Garibaldi Resources…more next week. As always, perform your own due diligence.
Zenyatta Ventures (ZEN, TSX-V) Chart Update
Note: John, Jon and Terry do not hold share positions in ZEN. Jon holds a share position in GGI.
I checked Gold last night, it was down over $30.00, right now it is up
over $6.00. Cheer up ! R !
Comment by Bert — June 28, 2013 @ 8:03 am
sorry…speaking of cxo.v getting lots of great coverage here and newletters!!glta
Comment by natalie — June 28, 2013 @ 9:53 am
appreciate if someone could post a list of Telegraph Creek stocks
I have GGI.v FTR.v TCK/B.to DBV.v PGX.h.v ABR.v
any others
thanks
Comment by ChartTrader — June 28, 2013 @ 10:11 am
There is plenty of life left in this project and the risk/reward is fairly good in the current range. If the stock dipped again in the next few trading sessions it would be worth accumulating or averaging up in ad- vance of new drill results from North ROK.
from hra newsletter at the beginning of June when stock was over .80
Comment by natalie — June 28, 2013 @ 10:28 am
4 p.m. Nfld time, Gold is up $15.00 & it looks as if we may be seeing
a key reversal today & Gold could be starting it’s climb back. If so,
better days’ ahead. GOLD luck ! R !
Comment by Bert — June 28, 2013 @ 10:50 am
@ Jon from bmr. When you attended Dyg’s AGM meeting, did they mention how much the drill program would cost and if they already had the money to drill?
thanks in advance.
Tony T.
Comment by Tony T — June 28, 2013 @ 11:01 am
Lots of money to drill – about $1.2 million in the treasury, so that will easily cover their drilling costs. This is a really good area geologically and they’ll be focusing on the northern part of the property where they’ve built up quite a database of information. Interestingly, Richard Billingsley was at the meeting – huge landholder in B.C. and he was the one who originally optioned this property to Dynasty. He calls it like it is and loves this particular property and how Dynasty has moved it fwd.
Comment by Jon - BMR — June 28, 2013 @ 3:27 pm
Thanks Jon. I did notice yesterday that the v.dyg bids have increased over the last few days. The 1.5 cents bid grew from 200k a few days ago to over 700k at close yesterday. Cheers and have a good weekend.
Comment by Tony T — June 29, 2013 @ 4:32 am
ALOT OF PEOPLE ARE STARTING TO THINK THE REVERSAL YESTERDAY IN GOLD MIGHT INDICATE A CAPITULATION POINT AND TURNING POINT…..HOPEFULLY, YOU GUYS CAN COVER THIS OFF IN YOUR NEWSLETTER THIS WEEKEND? ALSO, THEY SAID IT WAS SHORT COVERING ‘COMBINED’ WITH STRONG BUYING AS IT RAN ‘UPWARDS’ RIGHT TILL THE END OF THE DAY….MAYBE GIVE THE VENTURE A SUMMER RALLY! WE NEED SOMETHING!
Comment by STEVEN — June 29, 2013 @ 10:11 am
It’s an honest exploration deal run by very capable individuals, which is something we don’t have enough of in this market. Exceptionally strong board that includes New Gold President and CEO Bob Gallagher. They could hit a home run or they could miss, that’s exploration, but their targets are being well thought out and there’s no denying the very favorable geology of this area. They do see some similarities to the Eskay Creek model which is interesting – the most obvious being the fact both are underlain by Jurassic sedimentary and volcanic rocks of the Hazelton group. They need to drill deeper than 200 metres and try to hit that sediment-volcanic contact…..the type of potential mineralization we’re looking at here is high-grade…a DEEP EM geophysical survey from 1990 is being reinterpreted to help provide a greater understanding of this system and to better pinpoint drill targets….the survey revealed a 1 km long conductor open to the north that’s very, very striking on a map…in this same northern area, they performed some field work last summer that returned some outstanding rock and soil sampling results…
Comment by Jon - BMR — June 29, 2013 @ 11:13 am
BMR folks – what happened to RBW? I followed the rainbow, but it took me to a cliff and right off its edge to a 1000 ft free fall. This was one of the worst stocks I’ve ever owned.
They can’t even raise money to drill – lame.
Your input would be great – I think most people who bought on this board on your recommendation (and yes it was a very concerted pump show on this site) deserve to know what those clowns are doing over at their Queen and Bay office in Toronto.
Thank you
Comment by Alex Saatjian — June 29, 2013 @ 2:21 pm
Alex, RBW raised more than $2 million last year, drilled 3 properties and the stock outperformed the overall market throughout almost the entire year. We initially introduced it to our readers when it was trading around a dime and it tripled from there. They missed on a first crack at the International, which didn’t help, but got very encouraging results from Gold Viking (which needs to be followed up) and Jewel Ridge. Unfortunately, like just about every other company on the Venture, they got hit hard by the sudden drop in the Index in February and the brutal sell-off in Gold-Silver – the worst quarter for Gold and Silver perhaps in a century, and this was particularly bad timing for RBW. What happened to RBW – it got sold off to all-time lows – is exactly what happened to hundreds of other juniors. RBW has an excellent basket of properties and when the time is right, they clearly have the ability to rebound very strongly. Given current overall market conditions, we believe the wise approach at the moment is to focus on very special situations. While this bear market continues, there are still excellent opportunities in a small universe of active special situations – we’ve seen quite a few in the past couple of months and some of them have recorded major gains. When you’re investing in these Venture companies, you have to understand that each of these companies is a very speculative investment and you run the risk of losing everything. Having said that, you can’t beat the leverage that this market provides. Spread yourself out – do not put your eggs all in one basket – because all you need is to be hugely successful on 1 play out of 10, and you can make a fortune. Not every play is going to work out as you hope because there are too many things that can always go wrong. Keep your losses to a minimum (you will always have some losses here and there), only get greedy when others are extremely fearful, and take profits along the way when when you’ve got a winner. I heard a story recently of a gentlemen who had well over 1 million shares in a Venture company at 14 cents. He watched it run to nearly $1. He sold nothing along the way, convinced the stock was going to hit $2 per share. That’s outright stupidity and greed. He recently sold his entire position around 4 cents, losing 70% of his original investment after he was up over $1 million and 8 times his initial investment. Use common sense and take responsibility in terms of doing your own DD. If you approach the Venture in that manner, and also understand that most of the companies on this Exchange are not well-run and are too often infested with liars and promoters who are only interested in flipping paper and lining their own pockets, you’ll have a great chance at success.
Comment by Jon - BMR — June 29, 2013 @ 2:50 pm
GOLDFIELDS and Granada Quebec – m,ay be good news for GBB
28 Jun 2013 |
Granada got a huge boost in value and credibility this week —— A major gold company with very deep pockets has come to the Granada region. The next few months should be interesting.
(Montréal, June 26, 2013 – Yorbeau Resources Inc.(TSX: YRB.A) is pleased to announce that the option and joint venture agreement with Gold Fields Sudbury Exploration Corp., a 100% indirect subsidiary of Gold Fields Limited (“Gold Fields”), commenced on June 26, 2013……Gold Fields has advised Yorbeau that it has completed the due diligence investigation and that all conditions under the agreement have now been satisfied with an effective Commencement Date under the agreement of June 26, 2013.
Comment by alois — June 29, 2013 @ 3:16 pm
Hi Jon, are you still holding most of your RBW shares? Thanks
Comment by Alexandre — June 29, 2013 @ 4:26 pm
I still have a significant investment in RBW and I’m very comfortable with that for the longer-term, especially with how things are building in B.C. on the exploration front. At the right time, I would add to my investment in RBW but at the moment I see other opportunities with companies that are in an excellent position to capitalize on those opportunities immediately. It’s better to have a stable of horses than just one horse, as I alluded to in my previous post.
Comment by Jon - BMR — June 29, 2013 @ 5:06 pm
Hi Jon, Nice to hear about your position. I find great solace about RBW that insiders are buying, and I think they will continue to do so. Their Jewel clain is adjacent to a major producer, great potential for acquisition.
Comment by Alexandre — June 29, 2013 @ 5:22 pm
They’ve got a big position and plenty of “skin in the game”, so you’re right – that’s very encouraging. RBW will survive these tough times.
Comment by Jon - BMR — June 29, 2013 @ 5:49 pm
Jon, does BMR follow eastmain Resources, ER?
Comment by Alexandre — June 29, 2013 @ 6:05 pm
Glad you brought this one up as it’s worth looking at. That’s what’s great about this forum when some good ideas come to surface. ER has been in a prolonged downtrend, like many others, but has a package of quality properties including their flagship Clearwater Project in Quebec with a high-grade resource. Interesting move in the stock Friday on no news. They announced plans in April for a major drill program (25,000 metres) – I wonder if they still plan on being that aggressive given current market conditions. Personally, I’m not as bullish on Quebec in general now because of the politics and environmental lunatics running around there at the moment, but one cannot dismiss good opportunities in that province and ER would be one of them. Also, as another reader pointed out, look how Gold Fields has stepped in with Yorbeau’s Rouyn Property – impressive. Interesting news Friday as well from EAG re: Windfall Lake. Worth putting Eastmain on the radar screen.
Comment by Jon - BMR — June 29, 2013 @ 7:36 pm
I owned ER on and off over the years and it has served me well.
Comment by Alexandre — June 29, 2013 @ 7:51 pm