CDNX
The CDNX remains in a powerful uptrend though it finished 12 points lower (less than 1%) on the week at 1,593 (the TSX fell 2.2% on the week while the TSX Gold Index dropped 5%). The CDNX hit a new 52-week high of 1,629 intra-day last Monday before dropping 3.4% to 1,573 by Tuesday as commodities took a hit. Friday’s action was impressive as the Venture Exchange largely erased a 15-point intra-day deficit to finish just two points lower on the day at 1,593. Again, the CDNX continues to show amazing resiliency even in the face of weakness in commodity prices which suggests to us that the junior resource market still has plenty of upside along with commodities. We will continue with the strategy of buying into any weakness with the Venture Exchange until the technicals break down and tell us to run for the exits (which likely won’t happen until we see at least 1,950).
BullMarketRun.com Portfolio – Another Good Week!
Gold Bullion Development (GBB, TSX-V)
Gold Bullion had another strong week, trading over 2.2 million shares and closing one cent higher at .12. An exciting exploration and development story is unfolding at Gold Bullion’s Granada Gold Property in Quebec, 40 miles west of Osisko’s (OSK, TSX) Canadian Malartic Deposit, as we have been explaining over the past few weeks. Not surprisingly there’s a real buzz at Gold Bullion’s booth at the Vancouver Resource Investment Conference, an event that wraps up at 6:00 pm Monday, and company President/CEO Frank Basa – who we will be interviewing Monday – is clearly upbeat. Assay results from December’s phase one drilling program are still pending and our “hunch” (based on Gold Bullion’s latest news release and our understanding of the geology of the Granada Mine and the surrounding area) is that these results will provide solid new evidence of the blue sky potential of Granada. From a technical perspective, the volume and price surge in this stock over the past six weeks or so has been eye-popping (record volumes for this stock) – this kind of activity almost always precedes a massive breakout. Gold Bullion is up 60% since we initiated coverage a month ago.
Seafield Resources (SFF, TSX-V)
Closing at 27 cents Friday, Seafield is now up 350% since we first brought this little gem to investors’ attention last summer. And the real fireworks with this stock, in our view, hasn’t even started. Seafield’s ties with privately-held Caribbean Copper and Gold Corporation are going to position it for tremendous success in Colombia, we believe, and Seafield also has highly prospective properties in Mexico and Ontario. The company is cashed up and seems to have some powerful players behind it. The heavy buying at current levels by M Partners and Fraser McKenzie, among others, gives us a lot of confidence that Seafield will go much higher in the weeks and months ahead.
Kent Exploration (KEX, TSX-V)
Kent had a strong week, reaching a new 52-week high of .245 before closing Friday at 22 cents. The company released some encouraging assays on trench sampling at its Alexander River Gold Project in New Zealand including 8 metres of 10.56 g/t and 3.2 metres of 24.6 g/t. The corporate strategy and determined focus of CEO/President Graeme O’Neill bodes very well for Kent shareholders. We are extremely bullish on the company’s Australian and New Zealand properties which are going to be explored extensively in the weeks and months ahead. The stock is up nearly 40% since we initiated coverage last fall.
Colombian Mines Corporation (CMJ, TSX-V)
Colombian Gold Mines gained five cents on the week to close at exactly $1.00, a 67% gain since we added this stock to our portfolio six weeks ago. The story here is pretty simple and compelling – a tightly-held stock with a very substantial and high quality package of exploration projects in Colombia where it is no Johnny-come-lately. CMJ will be soon be drilling its Yarumalito Gold Property, and on Friday the company also reported some good sample results from its El Dovio project. Colombian Mines currently has a $20 million market cap but a lot of potential still exists here, we believe.
Richfield Ventures (RVC, TSX-V)
Richfield roared to a 52-week high of $1.95 in the first week of January on drilling news and has backed off considerably since then, closing Friday at $1.14. Nothing has changed with this company – it is sitting on a potentially world class bulk tonnage deposit in the interior of British Colombia – other than the fact a whack of cheap private placement stock from last fall (between .12 and .17 cents) has become free trading. We expect this stock to head even lower in the near future as the market absorbs this paper, creating a tremendous buying opportunity in very oversold conditions. We will have more on this in the days ahead.
Greencastle Resources (VGN, TSX-V)
We added Greencastle to our portfolio last week at .175, and the stock closed Friday at .17. We have more to report regarding Greencastle in the near future. The company is trading barely above cash value and is currently drilling some test wells in southwestern Saskatchewan. Greencastle also has gold, coal and shale gas interests. With a market cap of just under $8 million and regular monthly cash flow, Greencastle represents superb value and very limited downside risk.
