As regular BMR readers know, Richfield Ventures (RVC, TSX-V) has been a favorite of ours for several months. We first highlighted Richfield in December when it was sitting at $1.20. Today it was very strong and closed up 29 cents to $2.20, so RVC has delivered big returns for some of our readers. Is it time to sell? Not a chance. Like Gold Bullion, this is one of those stocks you want to maintain a core position in for a potential takeover at much higher prices down the road. With a MAJOR discovery brewing at Richfield’s Blackwater Project in central British Columbia, this stock – much like Gold Bullion – could easily deliver massive gains in the weeks and months ahead.
Blackwater is a potential world class bulk tonnage, open-pit deposit located 150 kilometres southwest of Prince George, BC. Richfield drilled 18 holes last year, between August and October, and some of the results were absolutely spectacular (most holes less than 200 metres in depth):
BW-59: 329 metres @ 1.24 g/t Au
BW-57: 133.7 metres @ 1.02 g/t Au
BW-48: 148 metres @ 1.26 g/t Au
BW-47: 96.8 metres @ 1.01 g/t Au
BW-46: 207 metres @ 1.06 g/t Au
BW-43: 152 metres @ 0.77 g/t Au
BW-42: 98 metres @ 1.25 g/t Au
Richfield has commenced a 25,000 metre follow-up drill program at Blackwater which will lead to a NI-43-101 resource estimate by early next year. They are currently deepening BW-59 to 700 metres from 329 metres. On Monday this week the company reported the hole was at 509 metres and had intercepted similar volcanic lithologies, alteration and sulphide mineralization as seen in the upper 329 metres (BW-59 ended in strong mineralization last fall).
Richfield, which has a strong management group and is run by seasoned geologists, has a current market cap of $57 million based on 25,786,636 shares outstanding (40 million fully diluted). They had $7 million in the treasury at the end of February after completing a major financing last December.
A multi-million ounce deposit appears to be in the works at Blackwater – the drilling this spring and summer will certainly confirm that, one way or the other. We like Richfield’s chances here – majors are no doubt watching closely, and the possibility of this stock climbing to a market cap of $300 million or better by year-end is certainly very real. John, BMR’s very proficient technical analyst, also likes RVC as you’ll see below:
Richfield Ventures is very close to breaking out to a new 52-week high.
John: The weekly chart of Richfield Ventures shows that for the past 6 weeks the trading has been confined to a narrow range – $1.77 to $2.20.
A new base of $1.80 has been established and today’s finish at $2.20 is very close to the 52-week high of $2.25 where it met previous resistance.
The RSI is climbing, showing strength and is at the oversold border of 70% which leaves it plenty of room to move up further.
The MACD is above the zero line (bullish) and climbing.
The ADX trend indicator is in a bullish mode – ADX line (black) above +DI (green line) which is above -DI (red line) with the ADX line climbing past 50, showing there is good strength in this uptrend.
Volume moving forward will be important – I believe there needs to be at least 1 million shares traded this week (450,000 have traded so far) to ensure further price gains and a close above $2.20 by Friday, which is certainly possible.
