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…
