Gold hit another new record high this morning of $1,464 with bulls now targeting $1,500 per ounce over the short term…as of 7:30 am Pacific, the yellow metal is up $4 an ounce at $1,461…Silver is 43 cents higher at $39.71 while the U.S. Dollar Index is off over one-quarter of a point to 75.58…some analysts continue to believe that Gold is somehow in a “bubble” which in our view displays a complete misunderstanding of the dynamics driving this market…Yogi Dewan, founder and CEO of Hassium Asset Management, told CNBC the other day that “this is a bubble and a fear trade…as soon as the recovery takes hold and the interest rate cycle changes, you will see mass outflows from Gold into riskier assets”…Yogi is about to find out that in reality the bubble hasn’t even started yet in Gold…he’s correct in stating that there is a “fear trade” in Gold, which will likely only intensify, but he doesn’t recognize the “love trade” (mostly from the emerging markets and the Middle East) and how critically important a factor that is in terms of what’s driving Gold…Frank Holmes of U.S. Global Investors has written and spoken so powerfully about the impact of the “love trade”…in addition, stocks are not showing that Gold is in a bubble…the TSX Gold Index, even after yesterday’s sharp advance, is still less than 10% above its 2007 high…the CDNX is 1,000 points or 30% below its 2007 high…and one of the most important facts of all is that Gold ownership as a percentage of global financial assets is only 0.7% vs. 0.2% in 2002 at the beginning of the current bull cycle (a majority of that increase has been fueled by Gold’s sharp price appreciation)…as an asset class, Gold is still very much under-owned as the chart below illustrates….
The CDNX blasted through important resistance around 2330 yesterday which was a very bullish development…it appears very likely the Index will now challenge the early March high of 2465…as of 7:30 am Pacific, the CDNX is up another 16 points at 2370…Gold Bullion Development (GBB, TSX-V) released more drill results from Granada following the market close yesterday…while tonnage continues to build in the LONG Bars Zone, there were no eye-popping numbers out of the 25 holes…hole #179 (72.25 metres grading 1.25 g/t Au and 156 metres of 0.61 g/t Au) shows mineralization continues to push eastward from Pit #1…six holes drilled just NE and SE of #179 under the waste pile will be important to look for (holes #198, #199, #201, #248, #250, and #253 – assays to come)…hole #97 was a nice cut likely of Vein #2, 46.7 metres grading 1.51 g/t Au…holes like #69, #124, #136 and #193 don’t get most investors excited but they’re very important to the overall picture with long intersections of lower grade (177, 113, 189 and 165 metres respectively grading between 0.31 and 0.42 g/t Au)…Frank Basa will have no problem with those numbers, keeping in mind the “upgrading” effect at Granada…structure is there…more bulk sampling and different types of drilling will quantify and improve the grade…just a few holes reported from the southwest corner of the Block Model with many more to come from there – it continues to be a promising area…there were a smattering of holes from the Eastern Extension but nothing that jumped out at us…many more results are yet to come from the Eastern Extension including the northern part where good visuals were reported earlier…it’s interesting to note that on GBB’s drill map, three step-out holes have been drilled about 90 to 145 metres north of holes #55 and #108…it’s important to keep an eye on results from those holes…nothing was mentioned about drilling commencing further east in LONG Bars Zone 2 (Aukeko)…February’s news stated a drill was being moved out there in March…Aukeko is a key target…assay results are now in on nearly half of the 228 holes completed so far (45,000 metres) in Phases 2 and 3…47,730 metres in total have been completed since December, 2009…the case for the LONG Bars Zone remains intact…much, much more drilling lies ahead as this is all about volume (which is why we wanted to see more than two rigs by 2011)…the 43-101 this summer will be extremely helpful in terms of pushing this exciting project forward…GBB is currently off 2.5 cents at 44 cents…a potential imminent turnaround in GBB’s 20-day SMA would be a bullish technical development…Currie Rose Resources (CUI, TSX-V) has closed above its 50 and 200-day SMA’s for the first time since January…the 50-day is also ending a nearly three-month decline…CUI is gearing up for a new exploration season in Tanzania beginning this quarter and we are particularly excited about the Sekenke Project which will be drilled by Currie Rose for the first time…Sekenke runs in between and surrounds two former high-grade Gold mines including one of Tanzania’s original producers…CUI is currently off a penny at 17 cents…we suggest investors perform due diligence on a couple of situations we’ve never mentioned before – Levon Resources (LVN, TSX-V) and Revett Minerals (RVM, TSX)…Revett is an established Silver-copper producer in northwestern Montana (Troy Mine) with a massive Silver deposit (Rock Creek) that still faces some hurdles in terms of permitting…the company is hopeful however regarding Rock Creek…Levon, meanwhile, is making excellent progress in developing its large Cordero Project (Silver, Gold, lead, zinc) in Mexico…both stocks have very strong charts…White Tiger Mining (WTC, TSX-V) is looking very interesting…the company’s first hole of its Phase 2 program at its Marshall Lake Property in northern Ontario could be a stellar one as reported yesterday in a news release that sent the stock soaring to as high as 67 cents…Marshall Lake is an advanced stage copper, Silver and Gold project and we like the chances of a significant discovery…with only 15 million shares outstanding, this one has the potential to really take off and speculation surrounding hole RMZ-11-21 will keep interest high…this stock has been around since 2007 and has never had liquidity until now, so likely many investors took advantage of yesterday’s move to cash out simply to cash out…they weren’t paying much attention to the significance of the news…the stock stayed above its opening price yesterday of 48 cents, closing at 48.5 cents, and has held support at 48 cents so far today…it’s currently up 1.5 cents at 50 cents…the President and CEO is Ron Coombes who’s had a lot of success in the industry…no urgent need for a financing as the company raised $1.3 million in February…this is a good story that could develop nicely in the days and weeks ahead…Seafield Resources (SFF, TSX-V) now has two rigs working at its Quinchia Project in Colombia…we believe the second quarter will be more kind to Seafield after a disappointing first quarter in terms of the share price performance…Quinchia has very strong geological merits but investor patience is certainly required with SFF as it is with many companies at similar stages of exploration…John’s chart below does give some near-term hope….Seafield is currently off half a penny at 34 cents…
….and down GBB goes…beware of news from this company. Totally confirms the reason I sold my
entire position….I am starting to feel good about myself…hehe!
Comment by Paul — April 6, 2011 @ 6:40 am
Hi Paul,
The performance of GBB has been disapointing to say the least, but I think there is a great story here that given its scale needs some time to unfold. The stock got very overbought and I think that some consolidation in this range is inevitable. I think as more results come out and we edge closer to the 43-101 that the stock will breakout to he upside at an alarming rate, just MHO
Comment by Herb — April 6, 2011 @ 7:03 am
This is a post from another board, could BMR comment on this with their thoughts please?
Hey GBB Longs,
Thought I would post as it has been fun watching and reading. The share price at this level is a screaming steal but have to admit sold all my GBB pp shares from last October when they came free and realized no gain as they were trading at 54 cents after that disasterous nr release with such awesome numbers! Rolled it into INT and am quite happy as am up almost 100%. That said I have been watching this stock and held it for almost all of the last year. The things I have learned are as follows; the management has no interest in short term price fluctuations and is only concentrating on drilling to determine the ultimate size of the ore bearing structure. Once that is done they will go back and drill for grade which should be substantially better as RC drills will be used which detect gold and the nugget effect much better. Do I believe the grade will be anything close to the one they used for the Pre Block Model (1.6 per ton) NO! But I think half that (about .8-.9 per ton) is very realistic. The talk of a 43-101 by June-Early July is flawed I feel because I think they will want to incorporate as much drill data as possible and the Phase 3 won`t be done for another couple months at best and then drill results will take probably another 4-6 weeks to get back. This is all based on past time lines and don`t feel things have been sped up that much. Thus they won`t be able to start a 43-101 until late June-early July. My reasoning behind this is that they will want to show as many ounces as possible and to do that they need as many results as possible. Thats why they are drilling the silver property to give the market something else to concentrate on while we wait for the Granada 43-101. In my opinion they have enough money to carry them at least until October-November. If they wait and incoporate as much info as possible in the 43-101 thereby showing the most amount of ounces they will get the biggest boost to the share price when it is released. The warrants from the PP of October 2010 will bring in another 5 million and tax credits add another 3-4 million so gives them enough to start a much larger Phase 4 after the 43-101 is released. Once the market believes the gold is there and VERY economical to mine they will push the share price up as the Phase 4 continues to increase the size of the deposit. By the end of the year they should be able to do a much higher priced financing with gold probably at 1500-1600 an ounce and at least 3 million ounces proved up with the market calculating extra ounces as each new batch of drill results is released. The size of the deposit I believe is monstous and drilling will evetually reveal this to the markets. You can listen to Frank and the boys all you want but judging by their past performance I am convinced this is their plan. Maybe I will be proved wrong but this is the way I am gonna invest! Still have my 50000 warrants but plan to load the boat around early August if I am in fact correct and the share price is still below one dollar, I think it will still be in the 60-70 cent range. I firmly believe that Granada will ultimately go down as one of the biggest deposits in Canadian gold mining history and one of the big players in the business will at some point take us out! What that price will be I cannot say but I will be betting a substantial sum of my resources that it is many multiples from todays price! All the best to the longs in this story and do feel that we will all be rewarded handsomely at some point in the next couple of years!
Longrider
Comment by GREG H — April 6, 2011 @ 7:50 am
From looking at the chart of SFF am I correct in assuming that the 200 day sma is 31 cents?
thx
Comment by GREG H — April 6, 2011 @ 7:52 am
Also,Revett will soon be listed on AMEX,look how strongly GPR.TO took off after it was listed there!!
Comment by dave — April 6, 2011 @ 7:53 am
Hi guys,
I have been buying a stock name Prodigy Gold pdg-tsx.
They have release a preliminary a positive economic assessment for a open pit project in ontario. They have great grade (261m Grading 1.13 gpt Gold Including 104.6m Grading 2.06 gpt Gold at Magino)and they seen to be very aggresive.
The 5 years chart look very robust. They have a 20 000M drilling program going on.
Would like your opinion on this one.
Good luck with your investments.
Martin
Comment by Martin — April 6, 2011 @ 8:19 am
Hi Martin, I’ve been looking at PDG myself recently, and thanks for bringing it up. Their project appears to have quite a bit of merit. The hesitation with some people with regard to PDG is that this is the former Kodiak which of course ran to $5 and then imploded. PDG has potential, though, with this new project.
Comment by Jon - BMR — April 6, 2011 @ 8:35 am
Martin
At a glance, the one thing i don’t like is the number of shares o/s, 184,000,000.
R !
Bert
Comment by Bert — April 6, 2011 @ 8:45 am
Interesting comments and he’s probably not far off the mark. I too believe the key at this point is the 43-101. Investor patience is really required here. Short-term momentum was really snuffed out of this in mid-February which was unfortunate. Over the long haul, though, this remains a potential HUGE winner which is why we’re not panicking about the lower share price. The fundamentals are strong.
Comment by Jon - BMR — April 6, 2011 @ 8:48 am
Greg, just a tad under .32 actually. With SFF it’s important also to keep an eye on the 300-day (28 cents). The long-term trend remains up with this, based on the technicals. It will help with exploration being ramped up at Quinchia – Dos Quebradas and the surrounding area (including the Santa Sofia target) is the blue sky with SFF and I’m confident we’re going to see some breakthrough results from the drilling there. Just give this time.
Comment by Jon - BMR — April 6, 2011 @ 8:55 am
thanks Jon for the comments
greg
Comment by GREG H — April 6, 2011 @ 9:15 am
I don’t understand why the sp of GQC is falling, especially with the CDNX and gold on the upswing They already have a flat lying ore body close to surface with a 43-101 and 400,000 ounces of gold based on only 25 holes. Drilling another 40 holes which is sure to increase ounces in the ground. Hopefully they are quiet for good reasons. I would have expected some results by now….. unless they are waiting for more results before releasing results on 8 or 9 holes……anybody talk to the company lately? The last time I had a response was approximately 3 weeks ago and they said results should be out soon on 8 or 9 holes. On another note, EVR is drilling deep on their property next to Barrick’s huge Pueblo Viejo gold deposit and someone can correct me if I am wrong, but doesn’t GQC hold claims close to EVR? If EVR hits big, GQC could go along for the ride.
Comment by Dan — April 6, 2011 @ 12:50 pm
hi
Comment by steve — April 6, 2011 @ 1:38 pm
sorry hi again.
About gbb;
Jon when you say nothing was mentioned about drilling commencing further east in LONG Bars Zone 2 (Aukeko..
Do you aknowledge hole gr 11-254 in progress in the east north east of the up dated drill map ?.. IF it ‘s not aukeko it ‘s pretty close ain’t it ?
moving the drill in the area won’t be a problem i’ m sure , they’ve got golden roads 🙂
Comment by steve — April 6, 2011 @ 1:45 pm
Anybody take a look at RIC lately? $7.30 per share…..really on a tear. They also ammended their shareholder rights plan on March 28th. Wonder why? This should bold well for CQX, although it hasn’t responded yet. Another one that is quiet on the news front….with gold soaring I think it is time the company let their shareholders know what their plans are. Any thoughts on this one Jon as well as my post on GQC?
Thanks,
Comment by Dan — April 6, 2011 @ 2:24 pm
Dan, GQC hold the Piedra Iman claims, mentioned in the past by BMR. These are north west of and border EVR’s APV claims. They provided the basis fo Dr. Richard Sillitoes 2006 paper proposing that the lithocap could be concealing large VMS deposits. The paper was written in collaboration with two geologist who worked for GQC at that time.
The importance of Barrick taking a position in GQC can not be overstated. But it would be nice to have some more info about how much they hold, when they bought and their thoughts about GQC. Already having a deposit worth billions I am sure they are not buying into GQC for investment purposes, hoping to double their mney or even hit a ten bagger. That would be insignificant for themSuppose they hold $6 million in shares, or close to 20%. While it would be nice even for them to see that turn into $60 million, that would be nothing for them. They are holding for other reasons.
Can’t get all that excited about La Escandalosa. It has 400,000 oz. of inferred au. Have to see if the new results turn that into an economic resource. If they do, as Fisher indicates the low stripping ratio should make it profitable.
Comment by george wohanka — April 6, 2011 @ 5:09 pm
In the news release, GBB mentions the size of the deposit as 1.2 kilometers by .5 kilomters by 300 meters. If that is all mineralized and the average grade is .3 g/t, that works out to about 4 mil oz. I don’t think it is all mineralized, but I can dream. I’m just hoping for at least 3 million ounces.
Comment by Newager — April 6, 2011 @ 8:45 pm
keep your eyes on toe(triorigin) don’t say i didn’t warn you walter
Comment by walter emond — April 7, 2011 @ 3:15 am
Hi Steve, I noticed hole 254 but it is not even close to the Aukeko target. Aukeko is at least 1,000 metres east of hole #98……based on this drill map, one rig remains in the Preliminary Block Model area and the other rig is in the Eastern Extension of the main LONG Bars Zone (not LONG Bars Zone 2)…..there are a couple of possible routes to LONG Bars Zone 2, straight east or through a route from the south. One of the best times to drill in LONG Bars Zone 2 is during the dead of winter as there can be some swampy conditions to deal with that can complicate matters, especially during the spring and early summer….
Comment by Jon - BMR — April 7, 2011 @ 4:12 am
Hi Dan, yes, Richmont is hot and it’s time for Cadillac to seize the opportunity. Hopefully we’ll hear something very soon. Trading in GQC at the moment I believe is technically-driven……no worries about GQC – the fundamentals are solid and it’s just a matter of time IMHO before they hit something juicy in the DR.
Comment by Jon - BMR — April 7, 2011 @ 4:15 am