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CDNX and Gold

The CDNX is showing signs of powering higher as illustrated in John’s updated chart and analysis posted earlier this evening.  For the week the CDNX was off 5 points to 1460.  It found strong support just above 1440.  The 1393 yearly low set May 21 is looking more and more like a very important bottom.  The CDNX’s 20-day moving average, which has been in decline for about 6 weeks now, appears poised to reverse to the upside by the end of the upcoming trading week which would confirm a new bullish trend.  Look for increased volume and higher prices in the week ahead.  Gold surged to a new record high this past week, just above $1,250, before pulling back to close the week in the upper 1220’s.  Technically and fundamentally, Gold is looking very strong right now and it’s likely just a matter of time before it makes a decisive move through resistance around $1,250 and runs to at least $1,300 and eventually much higher for reasons we have already detailed (debt, loss of confidence in currencies, etc.).

The BMR Portfolio

Gold Bullion Development Corporation (GBB, TSX-V)

Gold Bullion’s chart is a picture of beauty – it really is…and a picture tells a thousand words…GBB continues to climb, slowly but surely, and hit a new 52-week high last Tuesday of 52 cents on 3 million shares…the stock closed the week at 49 cents for a 6-cent jump over the previous Friday…drilling continues around-the-clock at the Granada Gold Property near Rouyn-Noranda, Quebec, where the company is conducting definition drilling within the Preliminary Block Model and exploratory drilling outside the Block Model…publicly available information from the Quebec Ministry of Mines shows that historical work at “Aukeko” and “Austin-Rouyn” (approximately 2.2 and 3.5 kilometres east of the Block Model, respectively) significantly expands the exploration potential of the LONG Bars Zone which has a current strike length of 1,100 metres…an east-west trending zone of shearing, alteration and quartz veining (with intrusions of syenitic feldspar porphyry) extends almost directly east of GR-10-17 (Gold Bullion’s easternmost hole drilled to date) for at least several kilometres…the deposit at Granada is open in all directions with the best potential going east and within the Preliminary Block Model itself at depth (>300 metres)…

Seafield Resources (SFF, TSX-V)

Seafield announced the closing of a nearly $3 million private placement Friday…significant “new players’ seem to have entered the picture with Seafield given the oversubscribed PP and the 10 million share day we saw May 13…in situations like this, we often see news and a strengthening of the share price soon after Exchange approval is granted on the PP…technically, it’s highly likely that Seafield bottomed out at 16 cents May 6…the stock closed at 17.5 cents Friday, up half a penny on the week…drilling starts soon at the company’s Quinchia District gold properties in Colombia…armed with approximately $5 million now in the bank, Seafield is likely going to be very aggressive in its exploration efforts…Colombia is a focus of attention for Seafield but ongoing exploration at a gold property in northwestern Ontario could have a significant impact on the stock as well…most investors aren’t aware that a newly-listed company called Manitou Gold (MTU, TSX-V) is drilling the former Big Master Mine which is immediately adjacent to Seafield’s highly prospective Elora Gold Property…initial drill results are imminent out of Big Master which has many high grade showings…interestingly, Manitou also just completed a $3 million financing (also announced on Friday) and they too now have $5 million in their treasury…

Kent Exploration (KEX, TSX-V)

Kent has had a rough few weeks after the Australian government unveiled a proposed “super tax” on producing mining companies…under pressure it appears they are now revising that ridiculous proposal…one of Kent’s 3 flagship properties (the Gnaweeda Project) is in Australia and the proposed spinoff of Gnaweeda into Archean Star Resources is now on hold due to investors’ current uneasiness with Australia…Kent announced a proposed private placement financing of $600,000 last Thursday which would significantly improve its balance sheet…hopefully Kent can complete that financing as soon as possible and move forward with its Alexander River (New Zealand) and Flagstaff (Washington State) projects until there’s more certainty and clarity with the mining and exploration sector in Australia…Kent closed at 11 cents Friday, a 1.5 cent drop for the week…Kent’s stock price has been down or unchanged in 10 of the last 11 trading sessions…technically, Kent is very oversold and due for a bounce back up…interestingly, the stock filled a gap this past week (10.5 cents) from last October…

Richfield Ventures (RVC, TSX-V)

Investors didn’t seem too excited with Richfield’s latest drill results and drove the stock down to a weekly close of $1.02, a 23-cent drop from the previous week…the stock has been in a steady free-fall since the first trading day of May when it touched $2.05…Richfield reported on 3 holes last Tuesday…BW-62, collared 117 metres northwest of discovery hole BW-59,  intersected 123 metres grading 1.09 g/t Au within a wider interval of 175 metres of 0.88 g/t Au…two other holes near BW-59 (east and northeast) did not deliver very favorable results…this is not unusual in the process of proving up a major deposit – some poor holes and some excellent holes can be expected…the theory is that the best potential for the Blackwater Project could be on its 100% owned lands to the south of BW-59…drilling has been progressing rather slowly at Blackwater which may be another reason for the weakness in the stock…a bigger camp and a second rig have now been approved…the stock is very oversold technically and is sitting just above its rising 300-day moving average where it should find strong technical support…

North Arrow Minerals (NAR, TSX-V)

North Arrow was up half a penny on the week to 17.5 cents…drilling at the company’s Beaverdam Lithium Project should be drawing to a close…2 of a planned 8 to 10 holes were completed by the end of the first week of May…North Arrow’s next major exploration activity will be the drilling of kimberlite targets at its Lac de Gras diamond property in the Northwest Territories…this is when things should get really interesting with North Arrow as Dr. Chris Jennings, one of the world’s foremost authorities on diamond exploration, has identified 70 high priority kimberlite targets (using proprietary technology) on North Arrow’s landholdings…only 1 of those 70 targets has ever been drilled before…the Diavik deposit, one of the richest in the world, trends right through the centre of North Arrow’s property…the ratio of kimberlite pipes to economic pipes is the highest in the world at Lac de Gras, so it’s really just a numbers game for Jennings and North Arrow President and CEO Gren Thomas who together discovered the Diavik deposit nearly two decades ago…

Sidon International (SD, TSX-V)

We remain very bullish on Sidon which is now waiting for CDNX approval on a private placement and a letter of intent/option for the possible purchase of the Morogoro East Gold Property in Tanzania…Sidon closed unchanged at 4.5 cents this past week, just above its rising 300-day moving average…Morogoro East is a highly prospective property in a very favorable jurisdiction for mining and exploration…

Colombian Mines Corporation (CMJ, TSX-V)

Colombian Mines closed up 6 cents at 90 cents this past week…more drill results are pending from CMJ’s Yarumalito Gold Property in Colombia…encouraging assays on 3 holes were reported last month…technically, Colombian is holding up well…it has found strong support at its rising 200-day moving average of 80 cents…given the promising potential of Yarumalito and a large package of other highly prospective early stage projects in Colombia, the long-term outlook for this stock continues to be very positive…

Greencastle Resources (VGN, TSX-V)

It was another quiet week for Greencastle which closed down half a penny to 12 cents…Greencastle remains in the BMR Portfolio because the stock represents excellent long-term value with the current price matching its working capital…Greencastle is generating at least $100,000 per month in cash flow from its Primate oil royalties and holds some solid gold properties along the Battle Mountain/Carlin Trend in Nevada…the time to buy Greencastle is always when it’s trading at or just below its cash value with the goal of selling into strength when it makes its inevitable move higher into the 20’s and possibly beyond…given its strong cash position and regular monthly cash flow, Greencastle has a very attractive risk-reward ratio at current levels…