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9:30 pm Pacific 

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Tonight, updates on 3 plays (CLM, MOON, AIS) as promised in our most recent Sunday Sizzler.

Crystal Lake Mining Corp. (CLM, TSX-V)

The thesis for owning and holding Crystal Lake Mining (CLM, TSX-V) is as valid today as it was just a few weeks ago when the stock was trading at significantly higher levels:  If you believe in Dr. Peter Lightfoot, one of the world’s top Nickel sulphide experts, and Richard Savage, the highly successful former broker who’s viewed as a rising star among the Venture’s newest CEO’s, then don’t fret for a moment about any temporary weakness in the share price – these two individuals are focused on a much bigger picture that involves creating a lot of wealth for investors.

Keep in mind that Garibaldi Resources‘ (GGI, TSX-V) shareholders who put their faith in Dr. Lightfoot in the spring and summer of 2017 were handomsely rewarded with life-changing capital gains, and Eric Sprott just placed another $3 million bet on Lightfoot by adding 1.1 million shares to his GGI holdings at $2.80.

Yes, it has been frustrating that Crystal Lake hasn’t provided an update on its activities in recent months, other than news out of the blue in late May regarding the closing of a previously unannounced financing for $1.17 million at 55 cents per share.  Notably, financings have been completed at increasingly higher prices since last year when CLM came to life in the low 20’s.

When a company goes “quiet” like this, it can be a sign that something quite significant is developing behind the scenes.  That’s what we believe is happening in this case, and the outcome could be really exceptional, so it’s best to remain patient and let Savage and Lightfoot do their thing.

We shouldn’t have to wait much longer.  We have reasons to believe, based on our myriad of contacts in different exploration/mining districts around the country, that CLM is in the midst of discussions that could lead to a “transformational” development for the company.  It’s also worth noting that Savage has many contacts across multiple sectors in the markets.  It’s wise to assume that he’ll leave no stone unturned in his quest to make CLM a huge win for investors.  The company is blessed with a strong group of shareholders.  Savage is acutely aware of this and he can be expected to leverage that strength to the fullest extent possible.

What about the Nicobat Project, you ask, where exploration including drilling was launched in the spring?  This is a large project with a pipeline of Nickel sulphide targets, and we’re confident it’s even more prospective now than it was months ago after Lightfoot and his team have had a chance to accumulate a lot of data and work through it.  However, being a one-trick pony creates even greater risk in the junior exploration market, hence we fully support the idea of diversifying Crystal Lake and creating a compelling multi-opportunity play – that’s probably what both Savage and Lightfoot had in mind before exploration even started at Nicobat.  The best deals can often take many months to complete.

CLM 8-Year Monthly Chart

Despite CLM’s drop to a new yearly low this week, the “Big Picture” is still very positive from an overall technical point of view.

When you have a stock that features rising 500 and 1,000-day moving averages (SMA’s), you can have high confidence the primary trend is in your favor.  If you recall, we pointed out how foolish it was for investors to be selling Canada Cobalt (CCW, TSX-V) just a few months ago in the low 20’s after a pullback from is earlier 2018 high of 55 cents.  Some investors were literally throwing massive potential profits out the window when they were hastily dumping their CCW paper out of frustration at or near the rising 500-day SMA (with a rising 1,000-day SMA beneath that for additional support)!

In the case of CLM, the 500-day continues to rise and it’s currently at 41 cents on this 8-year monthly chart.  This morning, CLM dropped as low as 38 cents.  A “sweet zone” for accumulation at the moment is between 35 cents, the rising 1,000-day SMA, and the low 40’s.  Reinforcing this as a “sweet zone” is Fib. support at 37 cents.

Furthermore, Slow Stochastics (SS) is in a low position (typically where big moves to the upside begin) while the ADX indicator confirms a bullish primary trend. The value of monthly charts is that they really give you an accurate picture of the main trend and where key support and resistance levels are.

The “Wave 4” move down to very strong support in the mid-to-upper-30’s is interpreted to be part of what’s called a 5-Wave Motive Phase – Wave 5 would involve an explosive move to the upside to new highs.

CLM closed today at 40 cents (42 cents on the Venture).

Blue Moon Zinc Corp. (MOON, TSX-V) 

Blue Moon Zinc (MOON, TSX-V) was the Venture’s most active stock July 20, climbing as high as 10.5 cents on total volume of 8.7 million shares (all Exchanges) on news that the company has received all necessary drill permits (multi-year) for its planned exploration and development programs at its advanced Zinc-rich VMS deposit in the foothills of northern California.  Since then, MOON has pulled back to 8 cents where we continue to encourage accumulation because there’s a low-risk opportunity here for substantial gains over the next month or two.

Now that permitting issues are settled, next up is drilling which we believe will commence between the 2nd half of August and early September.

Three key facts to keep in mind:

• Quality historic deposits such as Blue Moon’s (ignored for many years like Nickel Mountain) offer great exploration upside, and the updated NI-43–101 resource estimate clearly supports the potential for expanding resources and putting this deposit into production
• Technical expertise – President & CEO McGrath, a Canadian now living in the U.S., has assembled a strong team that can unlock the value of this deposit which features clean metallurgy and an in-situ resource of nearly 800 million pounds of Zinc, 70 million pounds of Copper, 11 million ounces of Silver and 300,000 ounces of Gold
• A Preliminary Economic Assessment, to be completed after drilling, is expected to show robust economics

Getting this deposit to a 10-million tonne size and beyond – certainly more than enough for a long-term production scenario – seems very feasible given how it remains open in multiple directions with many promising untested areas.  What we love about these historic deposits is that a lot was typically missed by early explorers, and new models/new technology have created prolific new possibilities (look at the success Wolfden Resources – WLF – is now starting to enjoy at depth at its Picket Mountain VMS deposit in Maine).  A set of fresh eyes could turn the MOON deposit into a huge winner.

Political developments and recent tax changes in the United States (the corporate tax rate has been slashed from 35% to 21%) have certainly made Blue Moon’s project much more attractive.

Ni-43-101 Resource Estimate

At a 5% ZnEq cut-off, the Blue Moon deposit features 3.2 million tonnes in the Indicated category grading 5.5% Zn, 0.62% Cu, 0.25% Pb, 1.35 ounces per tonne Ag and 0.04 ounces per tonne Au for an overall ZnEq grade of 9.0%.

Inferred resources at a 5% ZnEq cut-off are 3.3 million tonnes grading 5.4% Zn, 0.38% Cu, 0.38% Pb, 1.53 ounces per tonne Ag and 0.04 ounces per tonne for an overall ZnEq grade of 8.6%.

Higher Highs + Higher Lows!

Technically, MOON is exactly the type of situation astute traders and investors look for.  The stock is in a pronounced uptrend that started at the beginning of 2016, and since then a series of higher highs and higher lows have occurred.

• RSI(14) has established strong support at 50% and is on the upswing again at 55%
• ADX indicator confirms a decidedly bullish trend with room to strengthen
• %K (Slow Stochastics) is reversing higher
• Stock continues to follow a long-term uptrend line
• Key resistance is 10 cents

A.I.S. Resources Ltd. (AIS, TSX-V)

We’re not pleased with A.I.S. Resources‘ (AIS, TSX-V) President and CEO Mark Enright-Morin who has proven to be weak in terms of his market skills, from news release communication to raising money.  The fact this stock erupted from 20 cents last summer to nearly $1.50 in January and Enright-Morin wasn’t able to capture the benefits of that leverage through a financing was enough in our view to have him ousted.

There are 3 pieces of good news, however:

1. Changes appear to be on the way as AIS has recently completed an interesting deal with MGX Minerals (XMG, CSE).  MGX is run by the very astute Jared Lazerson whose company’s award-winning extraction processes and clean technologies could be a perfect fit for AIS’s Lithium assets.  The recent property deal completed between AIS and MGX is likely the beginning of a broader relationship;
2. Permitting approval for drilling and development of AIS‘ flagship Guayatayoc Project in Argentina is imminent following a successful UGAMP meeting in early July;
3. The company has enough money in its treasury, plus access to funds, to complete a significant first phase program at Guayatayoc and demonstrate that this could be a near-term Lithium brine producer.

Technically, a strong support band between 20 cents and 15 cents is expected to hold.  The potential is for a powerful turnaround within the next month or two.

Note:  John, Jon and Daniel hold share positions in CCW, GGI and MOON.  Jon also holds share positions in AIS and CLM.