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Gold is stronger this morning as it tries to battle through resistance between $1,370 and $1,380…as of 6 am Pacific, the yellow metal is $13 higher at $1,375…Silver has climbed 27 cents to $30.87 while the U.S. Dollar Index is off one-quarter of a point at 78.38…the CDNX, which climbed 22 points yesterday to 2380, may try to overcome 2400 today…January inflation numbers came out from China this morning…prices excluding food rose 4.9%, the most in at least 6 years…the number, although high, was less than the 5.4% the market was anticipating…structural inflation, however, has certainly taken hold in China where the acceleration in inflation reflects rising rents, a 48% surge in money supply in two years and increasing domestic demand in the nation that has replaced Japan as the world’s second biggest economy…Chinese officials are likely to engage in more monetary tightening as the year progresses but negative real interest rates still exists in China which is bullish for Gold…British consumer price inflation for January was in line with expectations, 4% vs. 3.7% in December, but it has nonetheless surged to double the Bank of England’s target…the Bank of England is expected to raise interest rates from their record low of 0.5% later this year…the budget plan President Obama sent to Congress yesterday foresees a record deficit of $1.65 trillion this year… that would be just under 11 percent of the $14 trillion economy – the largest proportion since 1945, when wartime spending swelled the deficit to 21.5 percent of U.S. gross domestic product…Obama’s deficit-cutting plan over the next decade lacks a great deal of credibility and could really be thrown out of whack if interest rates climb higher than expected…our Morning Musings have been posted earlier than usual today due to travel commitments…Seafield Resources (SFF, TSX-V) had a wild ride yesterday, climbing early in the trading session to a high of 46.5 cents after exploration news came out before the opening bell…however, a few hours later, an article from a Stockwatch business reporter concerning Seafield’s Colombian manager Ian Park sent the stock into a tailspin and SFF dropped as low as 31 cents before closing at 33.5 cents…markets often work on fear and greed, and yesterday was a fear-driven day in the Seafield market which was unfortunate because Park, a geologist and geophysicist, has a proven track record of exploration success in Colombia and has been instrumental in assembling a first-rate land package for Seafield (Quinchia) with multi-million ounce potential…the market has also been too focused on Miraflores (thanks in part to James West) because of last month’s spectacular drill result and hasn’t paid enough attention to what’s developing at Dos Quebradas, Santa Sofia and La Loma where the real blue sky potential exists for Seafield…we stated in December that Miraflores, while a decent deposit, has limited growth potential but that’s not the case with the porphyry targets at Dos Quebradas and elsewhere at Quinchia…we suggest investors do their due diligence on Visible Gold (VGD, TSX-V) which is quickly becoming one of the most aggressive explorers along the Cadillac Trend…the chart for VGD also looks very favorable as John pointed out yesterday…VGD has approximately $9 million in the bank and has already outlined a $6.5 million exploration budget for 2011 which includes at least 40,000 metres of total drilling, some of which is now underway…Visible Gold closed up 1.5 cents yesterday at 47 cents…the last half of February could be quite interesting for GoldQuest Mining (GQC, TSX-V)…newly-appointed President and CEO Julio Espaillat officially starts March 1 and by about then (and just prior to PDAC where the company will be showing some core) it’s reasonable to assume GoldQuest will have some initial drill results from Escandalosa in the DR and perhaps a 43-101 resource estimate for its Toral zinc-lead-silver project in Spain…with Espaillat as President and CEO, and the highly respected Bill Fisher as Chairman, GoldQuest has the right people in place to make this company a major winner this year…Fisher and Espaillat, who helped make GlobeStar a big success in the DR, will undoubtedly use the GlobeStar model to take GoldQuest to the next level…GoldQuest has plenty of technical support in the low 40’s…it closed yesterday at 43 cents…its market cap of $44 million is only one-quarter of the takeover price GlobeStar fetched late last year…Gold Bullion Development (GBB, TSX-V) is looking strong technically in advance of news from Granada which is a positive sign…GBB closed up 2 pennies yesterday at 75 cents…

John: Yesterday, Sidon International Resources (SD, TSX-V) opened at 13 cents, its high, touched a low of 12 cents and then climbed half a penny to close at 12.5 cents, unchanged on the day on CDNX volume of 1.2 million shares.

Looking at the 6-month daily chart, we see that in November Sidon traded in a horizontal trend channel for 17 sessions before breaking out to the upside from 10.5 cents.  In 8 sessions it reached a high of 26.5 cents on December 7 on huge volume of over 16.5 million CDNX shares. Then SD retraced to 18 cents (the Fibonacci 50% level) before breaking to the upside for 6 sessions. Afterward it resumed the retracement to trade in a horizontal trend channel between 12.5 cents and 13.5 cents.

The Fibonacci set shows the next level is at 36 cents (we caution that this is not a BMR price target as we don’t give price targets but a theoretical Fibonacci level based on technical analysis).  The main resistance levels for an upside breakout are at 15 cents and 22 cents.

So what do we look for to warn us that a breakout to the upside is happening or about to happen?

If we look at the previous breakout on Nov. 25 (vertical orange line), we see that there was an increase from the previous day’s volume, the close was above the top of the channel, the RSI broke above its EMA(20) and the 50% level. The Slow Stochastics %K crossed up above the %D above 20% and the CMF selling pressure began to reduce. So there are quite a few indications to watch for.   In this present situation the price is forming a base with the stock in distribution mode so we must first watch for an increase in daily volume which will probably precede an increase in price. Then the price will break above 13.5 cents and close above that level.

Looking at the indicators:

The RSI is flat at 38%, below the EMA(20) at 41%.

The Slow Stochastics is oversold with the %K (black line) at 13 and above the %D (red line) at 11.

The Chaikin Money Flow (CMF) indicator shows that the selling pressure in this channel is not as high as that in Nov., so perhaps the channel will be shorter than the previous one before a breakout occurs.

Outlook: The trading will continue in the channel until such time that the buying pressure causes a breakout.  Watch for the indicators we pointed out.

Gold is performing well today…as of 8:50 am Pacific, the yellow metal is ahead $7 an ounce at $1,364…Silver has jumped 60 cents to $30.51 while the U.S. Dollar Index is up slightly at 78.68…Gold’s immediate challenge is to get through a resistance band between $1,370 and $1,380…talk of slower than expected Chinese inflation helped drive Shanghai’s main share index to its highest level in 7 weeks today…it closed up 2.5% after its best daily performance in 2 months…January inflation data for China is due out tomorrow and traders are now expecting an increase of only 4.9% vs. an earlier consensus estimate of 5.3%…figures show that China officially overtook Japan as the world’s second largest economy in 2010…on a seasonally adjusted, nominal dollar basis, China’s economy came in at $5.88 trillion for 2010 vs. $5.47 trillion for Japan…the CDNX is up 19 points at 2377 as of 8:50 am Pacific…potash plays are strong this morning…Seafield Resources (SFF, TSX-V) came out with drill results from Miraflores and is the ninth most active trader so far… SFF is up a penny at 42.5 cents on volume of 2.5 million shares…the results from Miraflores were mixed but here’s the bottom line…as we stated in December, amid all the excitement surrounding that one hole at Miraflores, the potential of that deposit is somewhat limited but Miraflores is NOT what’s going to drive Seafield higher…Dos Quebradas, where drilling continues, and other adjoining porphyry targets such as Santa Sofia and La Loma are the key and we are very encouraged this morning to read that Seafield is soon adding a second rig which will start drilling at Santa Sofia…the dozen holes drilled at Miraflores should allow Seafield to upgrade and increase resources there to a little better than 1 million ounces…successful investing requires patience and those who are patient with Seafield have an opportunity to do incredibly well this year as Quinchia holds real potential for a series of deposits totaling several million ounces or more…strong bids continue in Gold Bullion Development (GBB, TSX-V) which is up a penny at 74 cents…as we pointed out in our Week In Review yesterday, the current trading in GBB resembles patterns we saw on a few occasions last summer and fall when the stock was below its 50-day moving average (SMA) for a period of time and then suddenly exploded to the upside…Visible Gold (VGD, TSX-V), a company we’ve been mentioning occasionally over the past couple of months, is looking very attractive from a technical standpoint right now as John pointed out with a chart this morning…fundamentally, VGD is loaded with cash ($9 million) and we expect it will become one of the most aggressive explorers along the Cadillac Trend…VGD is completely focused on the Cadillac Trend with three major properties at the moment and a JV with Cadillac Mining (CQX, TSX-V) on over 7,000 additional hectares…President and CEO Martin Dallaire has outlined aggressive exploration plans for this year and drilling has already started at one property, Silidor…Visible Gold is currently up 1.5 cents at 47 cents…Cadillac Mining is 3 pennies higher at 29 cents on light volume…GoldQuest Mining (GQC, TSX-V) is off two pennies at 42 cents…the 40 to 42 cent area is a zone of major technical support for GoldQuest…looking out over the next two weeks, initial drill results from La Escandalosa (GQC’s flagship property in the DR) are possible along with a 43-101 resource estimate for the Toral zinc-lead-silver deposit in Spain…this should be a major breakthrough year for GoldQuest, especially with Bill Fisher as Chairman and the newly-recruited Julio Espaillat as President and CEO…both were instrumental in GlobeStar’s success in the DR…GlobeStar was taken over for nearly $200 million late last year by Perilya Ltd. and it makes sense that Fisher and Espaillat will use the GlobeStar model in developing GoldQuest which has a current market cap of only $43 million…Sidon International (SD, TSX-V) is up half a penny at 13 cents…the stock is trading in a narrow band between its 200-day moving average (SMA) at 12 cents and its 100-day SMA at 14 cents…we saw the same situation in November just prior to a major breakout…

As regular BMR readers know, we have become quite familiar with the Cadillac Trend in northwestern Quebec over the last year after our discovery of Gold Bullion Development (GBB, TSX-V) and having closely followed its success.  Without a doubt, northwestern Quebec is one of the best places in the world to be exploring for Gold given the geological dynamics of the Cadillac Trend and the political environment as Quebec has consistently been ranked as one of the top three jurisdictions in the world for mining and exploration.

During our recent visit to Rouyn-Noranda we became much more familiar with a company by the name of Visible Gold (VGD, TSX-V).  We met with President and CEO Martin Dallaire and got a good feel for the direction this company wants to go.  Visible Gold is sitting on approximately $9 million in cash and has already laid out plans for $6.5 million in exploration this year at its various properties in northwestern Quebec (it’s entirely focused on the Cadillac Trend).  Drilling has already started at one property (Silidor) and is expected to ramp up considerably over the next couple of months with a total of 40,000 metres planned for 2011 (we wouldn’t be surprised if that number goes higher).

Dallaire, who lives in Rouyn-Noranda and knows the area like the back of his hand, is young and full of energy and has recruited an outstanding geological team which includes senior geologist Robert Sansfacon who played a key role in the discovery of Osisko’s (OSK, TSX) Canadian Malartic deposit.

With a strong treasury and a very capable team on the ground to make things happen, we believe Visible Gold is one of the most attractive opportunities at the moment among companies exploring along the Cadillac Trend.  VGD is certainly worthy of our readers’ due diligence.  Below, John takes a look at Visible Gold from a technical perspective:

John: Friday, Visible Gold Mines opened at 41.5 cents, touched 41 cents for its low of the day, and then strengthened to close at its high of 45.5 cents on CDNX volume of 608,000 shares.  For the week it gained 9 cents (24.66%) on total CDNX volume of nearly 1.6 million shares.

Looking at the 1-year weekly chart, we see that after trading mainly in the 15 cent to 24 cent range for the first half of 2010, VGD started to move up on increased volume at the beginning of August.   Over a period of 18 weeks it reached a high of 70 cents in November.   From there it started a decline that took it to a low of 34 cents early this month.   Since then it has recovered into the mid-to-upper 40’s.  As of 8:00 am Pacific, VGD is up a further 2 pennies at 47.5 cents.

The chart shows that after the flagpole that started in Aug. there was a 13-week distribution within a horizontal trend channel (top resistance is a broken blue line and bottom support is a broken green line). This support was broken in early January and the stock declined until it formed a “Morning Doji Star” candle pattern in the last three weeks. This pattern is a bullish bottom reversing pattern that derives its name from Mercury, the morning star that appears in the heavens just before sunrise. For the reversal to be complete it requires confirmation by this week’s trading being bullish.

The blue Fibonacci set shows the seed wave is from a base of 15 cents to the 100% level of 59 cents.   The Fibonacci target is at 86 cents (this is not a BMR price target as we don’t give price targets but a theoretical Fibonacci level based on technical analysis). The decline bottomed out at the 37 cent support level which coincides with the Fibonacci 50% retracement level. This was a normal retracement. The volume for last week was nearly 1.6 million shares which is the highest weekly volume since October.   The three main resistance levels to a new uptrend will be at 50 cents, 59 cents and 65 cents. The close supporting moving average is the EMA(10) which is flat and near Friday’s close of 46 cents.   The combination of the bullish candle pattern, the reversal at the 50% Fibonacci level and the increasing bullish volume makes this chart look very interesting for the coming days and weeks.

Looking at the indicators: The RSI has completely unwound the September to Nov. overbought condition and has reversed direction from the 40% support level (orange line). The RSI is bullish at 51% and pointing up and has broken above its trendline (thin orange line) – very bullish.

The Slow Stochastics has the %K (black line) at 13 and above the %D (red line) at 10. This scenario is very bullish for a strong price reversal.

The Chaikin Money Flow (CMF) shows the buying pressure is now increasing after being low during the first two weeks of the reversal pattern – very bullish.

Outlook: VGD is in the process of completing a reversal pattern which is well supported by the indicators.  The potential for a powerful move to the upside over the next several weeks is very strong.  As always, do your own due diligence but we believe you’ll like what you’ll see with this company.

Note: John does not currently hold a position in Visible Gold (Jon does).

Welcome to our site, or at least the initial version of it!  BMR has been online for over a year now and strictly through word-of-mouth we have built a large and loyal following.  It helps when your model portfolio is up over 200%!

We’re continuing with our plans to ultimately build a very unique investment and money-management resource site that goes considerably beyond what we have now.    An important component of this site will always be original research on small and undiscovered junior resource companies, mostly in the Gold exploration space, that offer very real and significant upside potential. We are extremely selective in the companies we feature and put forward to investors – we prefer quality over quantity.

We use a combination of fundamental and technical factors in determining the value and potential of a stock.  In terms of fundamentals we look for a company with a superb project supported by strong management.  Management must possess integrity, solid ethics and a determination to succeed and build shareholder value.

At BullMarketRun (BMR) we approach the handling of money from a biblical perspective and this is an important topic we will be sharing with our readers (and listeners) as the site continues to develop. The Bible teaches so much about money and how to handle it and invest it –  there are literally thousands of verses on how we should handle the money and possessions that God entrusts us with.  By examining the life of Jesus and reading the Word of God, we can all become fully equipped to be successful investors and handle money wisely in order to make it work for us.  If it’s the other way around –  if you’re a slave to money by being in debt for instance, or if you don’t respect the value of money and spend it foolishly –  you’re in trouble and you’ll never be blessed financially.  We have a God who thinks big – He created the universe – and He wants us to think big  in every area of our lives.  When we handle money from a Biblical perpective (His money that we have been given stewardship of) He will bless our financial decisions and an increase of tenfold or a hundredfold is always possible.  This all begins, of course, with a personal relationship with Jesus Christ by accepting Him as your Lord and Savior and putting Him at the throne of your life.  It is the most important decision you’ll ever make.

God Bless,

Terry Dyer

Owner/Publisher, www.BullMarketRun.com

GoldQuest Mining (GQC, TSX-V)

GoldQuest had a solid week, climbing as high as 48.5 cents and finding support at 41 cents…the stock closed Friday at 44.5 cents, a loss of just half a penny for the week…very bullish technicals, which John outlined in a GQC chart update recently, are in sync with this company’s strong fundamentals…GoldQuest made an important announcement last Tuesday as the company named Julio Espaillat its new President and CEO…Espaillat is intimately familiar with the DR…for the past 11 years he was President and General Manager of GlobeStar’s DR subsidiary…he was co-responsible for building the only currently operating mine (Cerro de Maimon) in the DR which is about 100 kilometres from GoldQuest’s Las Animas Project…of course GlobeStar was taken over late last year by Perilya Ltd. for nearly $200 million…two key members of the former GlobeStar team – Espaillat and Bill Fisher – are now heading up GoldQuest with Fisher having been named Chairman just a few weeks ago…this is extremely bullish for GoldQuest as our view is that Fisher and Espaillat will pull off another GlobeStar or even better…we stated in December that GoldQuest is one of our top picks for 2011 and we’re even more certain of that after our recent interview with Fisher who is highly respected in the mining industry…Fisher is very excited about GoldQuest’s La Escandalosa Property where drilling continues in an effort to expand the 43-101 inferred resource of 400,000 ounces…this is a flat-lying ore body and “the economics could be really quite compelling,” Fisher told us…it’s important to stress the 43-101 was completed on La Escandalosa  at a very early stage and the possibility of a discovery of one million ounces or even more is possible as this is such an attractive geological target…the deposit is open at depth as well as to both the south and the north toward another discovery of Gold mineralization by the company at Hondo Valle, approximately 1.2 kilometres away…Gold at La Escandalosa occurs as a flat-lying stratiform zone at shallow depth with mineralization interpreted to be part of a larger intermediate sulphidation replacement-style system which has now been defined intermittently over a strike length of 2,100 metres…the source of the mineralizing fluids remains unknown at La Escandalosa, leaving open the possibility of the discovery of mineralization in structural feeder zones or perhaps in a porphyry copper-Gold type system…the 400,000 inferred ounces outlined so far are over a 25-hole section 350 metres long…successfully linking this central mineralized zone to the north and the south is what could take this deposit to the million ounce plus category which would allow for production of 100,000 ounces per year…no major infrastructure or political hurdles…the regulatory framework in the DR is conducive to mining…GoldQuest has many other targets of considerable merit throughout its large DR land package including Las Animas which has a 43-101 inferred resource of 129,000 ounces of Gold, 2.5 million ounces of silver, 106 million pounds of copper and 130 million pounds of zinc…GQC will be drilling Las Animas immediately after Escandalosa…that will be followed by a drill program at Jengibre, a promising target about 30 kilometres southeast of Escandalosa…in Spain, Goldquest holds the Toral zinc-lead-silver deposit which has an historical (non-43-101 compliant) resource of 5.4 million tonnes grading 9% zinc, 6% lead and 45 g/t Ag…a 43-101 on Toral is currently being completed and is due very soon…GoldQuest has also acquired a second polymetallic project in the area (Lago, just a 20-minute drive from Toral), and more details are expected upon approval from the Spanish government of a mineral rights application for the property… GoldQuest, which has nearly $4 million in the bank, is up 128% since we introduced it to our readers near the end of September…this is a stock that got as high as $1.80 ($100 million market cap) in mid-2007 on less than what it has now…initial drill results from La Escandalosa and the 43-101 on Toral could come by the end of this month, and Fisher has promised strong news flow throughout the year…GQC has all the ingredients to become a huge winner this year as the bull markets in Gold and the CDNX intensify…

Greencastle Resources (VGN, TSX-V)

Greencastle was quiet last week, closing down half a penny at 25 cents…the stock appeared to bottom recently at 22 cents as John pointed out in an updated VGN chart…after gaining a lot of momentum last November and December, a lack of news has been the main factor that has caused Greencastle to drift lower…however, with approximately $6 million in working capital, three Gold properties and monthly cash flow from an oil royalty, it doesn’t take a rocket scientist to figure out that VGN is a bargain at current levels…volume has been low on the move down which confirms there’s nothing to be concerned about here…Greencastle will have its day in the sun again soon enough…the long-term chart remains very bullish with rising 100, 200 and 300-day moving averages (SMA) that are in no danger of reversing…it’s also interesting to note that President and CEO Tony Roodenburg, a large shareholder in VGN, has refrained from selling any of his holdings in recent months despite the fact the stock price more than tripled in value on high volume…this is different from past runs in the stock and adds further credence to our view that we haven’t seen the highs in this cycle yet from Greencastle – it’s poised for what we believe could be a massive breakout sometime during the first half of this year…Pinetree Capital has also accumulated more shares in Greencastle, so there’s every reason to be very optimistic regarding this company’s prospects in the days, weeks and months to come…Greencastle is up 79% since we added it back in to the BMR model portfolio three months ago…

Adventure Gold (AGE, TSX-V)

Adventure Gold has been a strong performer recently and is up 39% from its low of 36 cents January 20…we posted an updated AGE chart from John Friday which clearly shows this stock is on the verge of a potential breakout…an obvious first possible catalyst could be new drill results from Gold Bullion as Adventure Gold of course holds ground at Granada…AGE closed Friday at 50 cents, a gain of two more pennies for the week…the stock has climbed above its 50-day moving average (SMA) and the 20-day SMA has reversed nicely to the upside…AGE released significant news January 20…the company got some free drilling on its Granada Eastern Extension Property as it reported that one of Gold Bullion’s holes (#85) was drilled entirely on Adventure Gold land (just inside the boundary) while three other holes (#78, #83 and #98) were collared north of AGE’s property but finished within it…this didn’t surprise us and it’s not an unusual event in the industry…it worked out well for both parties in this case, however – all the core from those holes has been given to AGE who will share results with GBB…this represents at least $100,000 of drilling and all AGE has to do is pick up the assaying costs…given GBB’s “hit ratio” on holes, it’s reasonable to assume that at least one of the holes (or partial holes) on AGE’s property could be of the “stellar” variety…with more results coming soon from Gold Bullion, we expect Adventure Gold could continue to firm up…they do hold small but strategic parcels of land around Granada (immediately to the south and the west in addition to the east) that could become part of a large open-pit…their claims hold significant potential value and they have drill assay results coming in without even doing their own drilling which they plan to start upon completion of their program at Pascalis-Colombiere…that property in the eastern part of the Val d’Or mining camp is heavily underrated in our view…a 2,500 metre drill program started at Pascalis-Colombiere in December and is testing the former L.C. Beliveau Mine at depth (below 300 metres) as well as near-surface parallel Gold structures to the west…Pascalis-Colombiere is just 1.5 kilometres east of Richmont’s (RIC, TSX) operating Beaufor Gold Mine which has produced over one million ounces in its lifetime…it’s safe to assume Richmont will be watching developments at Pascalis-Colombiere with interest…Adventure Gold’s property has significant upside exploration potential…the geological setting is favorable for the identification of new high-grade Gold bearing veins and structures or bulk-style ore shoots…there are many untested areas and excellent potential at depth…L.C. Beliveau was a very profitable former producer…if AGE can prove up something significant through extensions to this deposit, we see a potential deal with Richmont which would be the natural choice to bring the mine back into production…we first mentioned Adventure Gold to our readers in an article September 29, just a couple of days following the company’s announcement that it had acquired land at Granada, when the stock was trading in the low 20′s…we officially added AGE to the BMR model portfolio at 34 cents October 28, so the gain since then is 47%…Adventure Gold has been around only since late 2007 and we are impressed by the company’s solid portfolio of properties (19 in six strategic areas in Quebec and Ontario)…also of immediate interest is AGE’s partnership with Lake Shore Gold (LSG, TSX) on the Meunier 144 Property where deep drilling is currently testing the down plunge extension of Gold zones located at the Timmins and Thunder Creek deposits…the current initial deep drill hole onto the Meunier JV property is continuing…when completed it’s estimated the hole will provide a deep cut on the projected target area at about a vertical depth of 2,600 metres…this will enable shallower wedge cuts to be considered if significant mineralization is found to be present in this area…the initial deep hole was collared on LSG’s Timmins mine property last August and has now passed the 2,000 metre mark in depth…if this deep hole succeeds, AGE could absolutely explode…

Sidon International (SD, TSX-V)

Sidon continues to trade in a narrow band between its 100 and 200-day moving averages (SMA’s), 14 cents and 12 cents, respectively…we saw a similar pattern prior to December’s breakout…Sidon closed Friday at 12.5 cents, a decline of half a penny for the week…this stock has shown clear trading patterns since the spring of last year and has been quite volatile…however, the primary trend remains up and Sidon has consistently found support at or just above the 200-day SMA…BMR will be interviewing President and CEO Kamal Alawas in the near future but a date for that has not yet been confirmed by Alawas who could be waiting for news prior to speaking with us…results are pending from drilling at Sidon’s Morogoro East Gold Property…the company reported zones of disseminated sulphides of pyrite and pyrrhotite as well as some chalcopyrite and arsenopyrite over intervals of 30 to 70 metres throughout all six holes drilled…we caution that visuals are not always reliable but there’s reason to be optimistic that Sidon could be on to something…the company is also trying to develop a placer operation at Morogoro and has also acquired ground near Canaco’s discovery…this company has come a long way since last March when we first introduced it to BMR readers at a nickel, and its new web site is just one more indication of how impressively Sidon has developed and matured…we see exciting possibilities for 2011…the company raised over $1 million through the exercise of options and warrants in November and December…

Seafield Resources (SFF, TSX-V)

Seafield had a rough week, plunging as low as 37.5 cents Wednesday (the 100-day SMA) before rebounding to finish at 41.5 cents Friday…that was still a loss of a nickel for the week…lack of news since the close of the December financing has not helped the Seafield situation as the company had built up some nice momentum…on the bright side, however, the fundamentals are strong and the chance of Seafield outlining several million ounces at its Quinchia District properties in Colombia this year is very real…the company’s current market cap of approximately $60 million is cheap if it’s able to prove up what we believe it may have…on December 3, SFF announced a spectacular drill result from its Miraflores Property and the stock rocketed to 77 cents…results are pending on nine more holes at Miraflores…given historical results, at least some of these holes should be very good…drilling now is taking place at Dos Quebradas, a property we believe gives Seafield its real “blue sky” potential at Quinchia… SFF reported December 8 that the first three holes had been completed at Dos Quebradas which is rich in porphyry targets over a wide area…DQ is just a few kilometres northwest of Miraflores…visual reports indicate that these three holes have similar styles of mineralization to an historical hole drilled by AngloGold that returned an interval of 39.5 metres grading 1.67 g/t Au…the potential of Dos Quebradas is evident from limited historical drilling and was confirmed by Seafield last year through soil geochemical surveys and magnetic surveys which are crucial to discovering hidden porphyries in areas of very little outcrop…Seafield also released results recently from trenching in one location from the southern end of the gold-in-soil anomaly that defines the northern extension of the Dos Quebradas porphyry…1.75 g/t Au was returned over 94 metres…Seafield has an excellent opportunity to develop a multi-million ounce Gold resource at its three major properties at Quinchia (Chuscal is the third property)…Seafield has in excess of $15 million in the bank to fund an aggressive program in Colombia…

Gold Bullion Development (GBB, TSX-V)

Gold Bullion had another relatively quiet week, trading between 72 and 77 cents and closing Friday at 73 cents…that was a 3-cent loss for the week…the current trading pattern looks very similar to what we saw a few times last summer and fall when the stock was trading below its 50-day moving average (SMA) for a period of time and then suddenly took off strongly to the upside…GBB has been trading mostly below its 50-day SMA since mid-January…the 10-day and 20-day SMA’s have now flattened out after being in decline for more than a month…the stock has stayed within a tight range (69 to 76 cents on a closing basis) over the past 20 trading sessions…a big move one way or the other appears imminent…given the stock’s overall trading pattern over the last year, the greater probability in our view is a sharp move to the upside…fresh results are due very soon from the LONG Bars Zone but we’re never nervous at a time like this…given our knowledge of the property and our “feel” for the LONG Bars Zone (we’ve walked the ground there several times), there’s no reason why results should not continue to be very positive…this is a great property and GBB has only scratched the surface…while some have expressed a concern that no assays have come out since late November, our take is that GENIVAR and Gold Bullion are probably reviewing an immense amount of data and trying to connect the dots and paint a bigger picture of what’s happening at Granada…there has been some very noticeable accumulation of GBB in recent weeks, particularly out of Canaccord…

Cadillac Mining (CQX, TSX-V)

Cadillac showed some renewed strength last week, climbing as high as 33.5 cents as some accumulation came back into the stock…John’s recent chart showed that Cadillac’s retracement from a January 4 high of 50 cents appears to have run its course with a 21-cent low February 3…CQX closed Friday at 26 cents, a loss of 1.5 cents for the week, but the selling pressure has eased as shown by the CMF and the 10 and 20-day moving averages (SMA’s) have flattened out after being in decline since early January…this stock had a huge run-up beginning late last year, surging from a low of 5.5 cents in November to its early January high of 50 cents…a significant pullback, in retrospect, was healthy and normal from a technical standpoint and has paved the way for another potential major move higher…there are many reasons we like Cadillac so much and why we believe it has the potential to soar in 2011…the tight share structure (25 million outstanding and 27.5 million fully diluted) is highly attractive and the management team is focused and shrewd….Victor Erickson and Andre Audet also have a combined immense amount of geological and engineering expertise…while Cadillac recently picked up a very interesting land package in Utah that gives the company huge potential upside over the coming months and beyond, it holds some very strategic and valuable properties in northwestern Quebec that we believe will be gaining a lot more attention in the very near future…Richmont Mines (RIC, TSX) jumped last Tuesday on more encouraging drill results from Wasamac where Cadillac holds a small but important parcel of land…Richmont is still drilling like crazy (three rigs are active on the property) and the company stated last week it expects to release a new 43-101 resource estimate for Wasamac on or about February 17…we believe Wasamac has excellent potential to become Richmont’s #1 producing mine and we expect a sharp upward revision in the resource estimate…the principle structure hosting Gold mineralization at Wasamac plunges north onto claims held 100% by Cadillac…in addition, from the only hole Cadillac has drilled at its Wasa claims, a hole that they deepened last summer, the company discovered a 300-metre thick altered zone that’s interpreted to be a feeder system typical of those seen under VMS systems in the Noranda camp…it’s clear that Cadillac’s Wasa claims hold considerable value and the company has the expertise to unlock that value…during our recent trip to Rouyn-Noranda, we also became more familiar with Vantex’s (VAX, TSX-V) Galloway Project (west of Wasamac) which we like a lot…geologists we’ve spoken to believe that mineralization at Galloway extends onto claims held by Cadillac which are about to be aggressively explored by Visible Gold Mines (VGD, TSX-V) as part of the CQX-VGD partnership on over 7,000 hectares in northwestern Quebec…so Wasamac and Galloway are two exciting projects to keep a close eye on in the coming days and weeks and each has the potential to impact Cadillac dramatically, especially considering the fact CQX’s market cap is just $6.5 million…we believe we have a big winner here, a potentially very big winner…

Abcourt Mines (ABI, TSX-V)

Abcourt closed at 17 cents Friday, a loss of 1.5 cents for the week, but technical indicators are showing positive signs that the recent weakness has probably run its course…the stock bounced off strong support at 16 cents (the 50-day SMA) Wednesday, Thursday and Friday…why investors would sell a stock at such an obvious level of technical support is what makes a market, we suppose…the heavy accumulation that began in Abcourt in December was no fluke in our view…this is a company with significant assets that could justify a substantially higher valuation…nearly 60 million shares of ABI changed hands on the CDNX in December and January – record volume for this stock, accompanied by a price jump from 14.5 cents…we’ve seen these type of volume surges before and they are always a very positive sign…Abcourt is being accumulated, and our best guess is that some savvy players like the assets in the ground…the company came out with news January 27, announcing it had intersected two new zones of high grade silver and zinc mineralization at its Abcourt-Barvue Property near Val d’Or…the 10,000 metre drill program continues with the goal of upgrading and augmenting existing 43-101 reserves and resources…the company is also trying to justify an expansion of the proposed mill from 650,000 tonnes to 1 million tonnes…Abcourt-Barvue is a former producer and one of the best silver assets in the country with nearly 20 million ounces in all-category reserves and resources (plus nearly 300,000 tonnes of zinc)…in addition, the company holds the former producing Elder Gold Mine near Rouyn-Noranda which it hopes to put back into production within 18-24 months (considerable infrastructure is already in place as we saw during our recent site visit)…drilling continues at both Elder and the adjacent Tagami Property where there is strong potential for a significant discovery…Abcourt completed a $4 million financing at the end of December…with 110 million shares outstanding, its market cap currently sits at just $17.6 million…continued drilling success and even higher prices for Gold, silver and zinc would be extremely bullish for this stock which has a history of major moves…from mid-2005 to early 2006, Abcourt rocketed from 15 cents to nearly $1.40…

Currie Rose Resources (CUI, TSX-V)

It’s definitely turnaround time for Currie Rose which bottomed out at 15 cents in late January…after being in decline for six weeks, the stock’s 20-day moving average (SMA) is very close to reversing to the upside…this is one of several important clues that the stock’s recent woes are likely over…the CMF is showing increasing buying pressure…RSI and Stochastics indicators are looking positive as well…Currie Rose was off a penny for the week at 18 cents…the first major area of resistance will be in the low 20’s in the vicinity of the still-rising 100-day SMA…the company last came out with news January 25, announcing a joint-venture deal with Australian-based Liontown Resources for Currie’s Jubilee Reef Gold Project in Tanzania…CUI’s focus is on the Sekenke and Mabale Hills Projects, so finding a partner for Jubilee Reef made sense…the deal commits Liontown to at least 5,000 metres of drilling at the property this year which will give Currie Rose a minimum of 23,000 metres of drilling at all of its properties in 2011…an 8,000 metre program is now underway at its Scadding Gold Property near Sudbury which was optioned to Trueclaim Exploration (TRM, TSX-V)…this property will be getting some major exposure with a segment on “Today in America” which is expected to air nationally on the FOX Business Network and regionally on CNN Headline News…while Currie Rose has had its market cap shaved considerably, from a high of nearly $40 million to the current $15.5 million, what hasn’t changed is the quality of this company’s project portfolio which remains as high as it ever was in our view…

Richfield Ventures (RVC, TSX-V)

Richfield hit a new all-time high of $5.49 Wednesday before being pushed back…it closed the week off 4 pennies at $4.86…last Tuesday the company released the final 7 holes from its 2010 drilling at Blackwater (a new program is now underway)… a one kilometre mineralized zone from east to west has now been defined…the latest results include 206 metres grading 1.56 g/t Au in BW-114 and 39 metres of 2.74 g/t Au in BW-112 which was collared 100 metres east of known mineralization…the company will be drilling at least 30,000 more metres this year and is also working on a Preliminary Economic Assessment which should be completed by the fall…given the state of the Gold market and the likelihood of continued exploration success at Blackwater, we don’t believe the stock will be hanging around current levels for very long…we were very pleased to see that Richfield got a well-deserved buy recommendation recently from GMP Securities which has initiated coverage on RVC with a 12-month target price of $11.10 per share…BMR introduced Richfield to its readers in December, 2009, when the stock was trading at only $1.20…GMP sees the potential for at least five million ounces of Gold at Blackwater which is located in central British Columbia…the primary trend remains up with Richfield and there’s every reason to expect more excellent drill results throughout 2011…we believe the company’s ultimate objective is to find a buyer who can put this deposit into production…if good drill results continue as we expect they will, we’re confident that objective will be met and the takeover price could be much higher than the company’s current market cap of approximately $210 million…

CDNX and Gold

The CDNX got as high as 2391 early in the week before a 2.5% mini-pullback set in that took the Index down to as low as 2333 (its 10-day moving average) Thursday.  This is a trend we’ve seen repeatedly since last July – strong advances with occasional testing of the 10 or 20-day SMA’s.  For the week, the CDNX was off 12 points after closing Friday at 2358.  The Index reversed intra-day Thursday, as we expected, once it touched its 10-day SMA.  There is massive support on the CDNX chart at 2300 – the January resistance plus the current 20-day SMA.  The next major upside resistance is 2450 while John’s longer-term Fibonacci target remains intact at 2790.  In short, we anticipate continued strength in the CDNX with a move above 2400 quite possible this coming week.

Technology, potash, rare earth and energy plays have been the leaders on the CDNX so far this year.  This is the kind of “rotational leadership” that one often sees in a strong overall bull market.  While there are no doubt some excellent opportunities in those sectors (a couple of rare earth companies we mentioned last fall, GWG and RUU, have done extremely well), at BMR we focus on our niche which is the junior Golds.  They have been laggards through the first six weeks of 2011 but that’s how big money is made in the market – rather than join the crowd and chase the flavor of the day, look for some quality junior Gold exploration companies that have been under some pressure recently but still possess attractive overall charts.  The masses have yet to pile in to these stocks and when they do, look out.  By mid-year we expect that some of these companies could be trading at two, three, four or five times where they are now.

Gold moved higher again last week, closing ahead $8 at $1,357.  Gold’s 14-day moving average has turned positive which has always been a sign of impending bullishness, but there’s no doubt the yellow metal is facing some near-term resistance between $1,370 and $1,380 in the vicinity of its 50-day moving average.

The fundamental case for Gold remains solidly intact – currency instability and an overall lack of confidence in fiat currencies, an extended period of negative real interest rates (inflation is greater than the nominal interest rate, even in China and India despite increasing rates there), massive government debt from the United States to Europe, central bank buying, flat mine supply, physical demand, investment demand, emerging market growth, geopolitcal unrest and conflicts, and the list goes on.  It’s hard to imagine Gold not performing well in this environment.  Uncertainty surrounding Egypt and how developments there could impact other countries in the Middle East will be watched closely by Gold bugs in the coming weeks and months.

President Obama outlines his 2012 budget plan tomorrow – despite rhetoric about decreasing the deficit over the next decade, we have little faith that this President and Washington lawmakers will be able to make any major progress this year (or even next year) in terms of addressing the U.S. federal debt.  The problem likely won’t be tackled seriously until it turns into a full-blown crisis, whenever that happens.  At that point Gold will be much higher.

A couple of interesting notes concerning Gold:

The Industrial and Commercial Bank of China’s ICBC Gold Accumulation Plan (ICBC GAP) allows investors in China to accumulate Gold through a daily dollar averaging program. The minimum investment required is 200 Renminbi or 1 gram of Gold per day, which is equal to $42 dollars. One million accounts have already been opened since April, resulting in the purchase of over 10 tonnes of Gold thus far. The ICBC Bank is the world’s largest consumer bank with approximately 212 million accounts.

J.P. Morgan stated last week that it is the only tri-party collateral manager to accept physical Gold as collateral to satisfy securities lending and repo obligations with counterparties. This comes as more clients look to use Gold as a hedge against inflation and to post as collateral. “The ability to finance and leverage the broadest range of asset classes is important to our clients. Many clients are holding Gold on their balance sheets as an inflation hedge and are looking to make these assets work for them as collateral,” said John Rivett, Collateral Management Executive for J.P. Morgan Worldwide Securities Services.

Silver enjoyed another good week.  It got above $30 an ounce again before closing Friday at $29.91, a gain of 77 cents for the week.  Great Panther Silver (GPR, TSX) continues to be one of favorite silver plays and got as high as $2.88 this week.  We alerted our readers of a great opportunity when GPR fell below $2.00 at the end of January.