Category: Gold

The week of December 10 was an interesting one in the markets. The markets hang on the Fed’s every word as if it is a feudal emperor, which is understandable because, in real terms, it is. So when the Fed said midweek that it was thinking of doing only 2 rate cuts instead of 4, markets took a real exception to this, and it triggered a steep drop.

Shortly afterward, we figured that this was probably just a “storm in a teacup” and that the market would steady and turn higher again and after Trump said he was thinking of abolishing the debt ceiling that’s what happened with strong gains on Friday, December 20, but what was more remarkable was the volume of stock buying on Friday, which is interpreted as bullish.

The key point to understand in all this is that nowadays, an overwhelming proportion of stocks are owned by seriously wealthy people, and they want the value of their holdings to be at least maintained and, better still, to rise. So, as they control the levers of power, they have organized the system so that money flows up the pyramid from the lower and middle classes to them.

So, working in cahoots with the Fed — the Fed is run by seriously wealthy people — they have created a perfect system of wealth transfer. The way it functions could not be simpler. The Fed works to continually increase debt, which is their product, but the now exponential increases in debt have the effect of destabilizing the debt market and driving up interest rates, and the solution to this problem is simply to create even more debt. This increase in debt /credit works largely to the benefit of the seriously wealthy, who get first use of the newly created money and drive stock markets higher and higher, but of course, the massive increase in the money in the system eventually feeds through into inflation and the “little guy” ends up paying for all this profligacy with huge increases in the cost of living.

Because we are so far past the point of no return with all this, it will continue until the system flies apart and self-destructs via hyperinflation, which is actually viewed as an ultimately attractive option by those in power because it will mean that the debts can be paid off in worthless coin. This is why the stock market trends are relentlessly higher even as the economy spirals into depression. It would appear that we no longer need to be worried about a market crash but instead be prepared for the fast-approaching hyperinflation.

Now we will review selected charts, paying special attention to the precious metals sector because it will be one of the biggest beneficiaries of a hyperinflationary environment, simply because gold and silver always retain their intrinsic value and because it is great value here after its recent selloff which has lately been exacerbated by end of year tax-loss selling.

Starting with the 6-month chart for the S&P 500 index we can see that the heavy selloff on Wednesday didn’t even put a dent in the major uptrend in force, with the market still way above its steadily rising 200-day moving average, but notice the large reversal candle on Friday and especially the huge volume driving this reversal which is viewed as having very bullish implications — it suggests that we will see new high again before long.

Next, we look at the 6-month chart for the 10-year US Treasury Yield where we can see at once why the market freaked at Powell’s remarks — rates were at their highest level for many months but by the end of the week, the cavalry were riding to the rescue to stabilize the debt market as we had expected.

The prospect of a stock market crash spooks precious metals sector investors, and with good reason — look what happened during the 2008 market meltdown — the sector was trashed, with GDX losing more than two-thirds of its value and a combination of the sector having a normal correction being exacerbated by end of year tax-loss selling and then re-emerging crash fears last week conspired to beat the sector down to a relatively low level where many stocks are now considered to be most attractive bargains since it should recover from here, especially as seasonals for it are also favorable.

Another point is that the sector doesn’t just get taken down by the big drops in the broad market; as we can see on the 6-month GDX chart, it has dropped on several occasions this year in tandem with the broad stock market. We can also see that we have a high degree of “compression” here with its having been pushed down through its still steadily rising 200-day moving average to a support level, which it has arrived at in an oversold state. In addition, the retreat from the October high now looks like a 3-wave A-B-C correction that has taken the form of a bullish Falling Wedge with lower volume on the C-wave retreat as compared to that on the A-wave retreat, which is seen as a positive sign.

You will recall that we (I) had earlier thought that it would Double Bottom with its November low, but the midweek plunge put paid to that. However, the idea was not so wrong as a Double Bottom can also be a 3-wave decline, according to Elliott Wave Theory, where the 3rd wave stops at the level of the 1st wave low. In any event, the sector now looks like a beach ball pushed underwater and has several big things going for it, which are — a resumption in the advance of the broad stock market, favorable seasonal factors, the end of tax loss selling as we go into the New Year and the fact that it is oversold within a larger uptrend.

So, this looks like a great time to buy the sector across the board, although it should be noted that large and mid-caps can be expected to conform best with expectations, a great example being Newmont Corp. (NEM:NYSE), which has taken a hammering over the past couple of months but rose on the biggest volume for more than seven months on Friday.

Lastly, it is worth us taking a look at GDX on a 1-year chart because, on this, we can see that, although it broke down from its upper trend channel in November and dropped, it has arrived at the lower rail of a larger prospective uptrend channel which, if valid, assures us of big gains across the sector going forward.

From the uptrend’s origin late in February, we appear to have a classic 5-waves up with the 5-wave being extended and breaking down into 5 sub-waves, followed by a 3-wave correction, which is exactly the sort of thing you expect to see in an ongoing bull market.

Important Disclosures:

Clive Maund: I determined which companies would be included in this article based on my research and understanding of the sector.
Statements and opinions expressed are the opinions of the author and not of Streetwise Reports, Street Smart, or their officers. The author is wholly responsible for the accuracy of the statements. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Any disclosures from the author can be found below. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

Clivemaund.com Disclosures

The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund’s opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund’s opinions on the market and stocks cannot be construed as a recommendation or solicitation to buy and sell securities.

Gold

Gold Co. Embarks on Phase III Drilling Program

Post author By Gold News Club
Post date December 31, 2024

Source: Mike Niehuser 12/27/2024

Nevada King Gold Corp. (NKGFF:OTCMKTS; NKG:TSX) recently started its Phase III drilling program at its Atlanta Gold Project, according to a Roth MKM research note.

Roth MKM analyst Mike Niehuser published a report on December 27, 2024, maintaining a Buy rating and CA$0.65 target price on Nevada King Gold Corp. (NKGFF:OTCMKTS; NKG:TSX). The company has commenced its Phase III drill program at the Atlanta Gold Project following the successful validation of its geological model and resource expansion strategy.

The Phase III program encompasses approximately 20,000 meters across 80 drill targets, building on previous Phase I and II campaigns. Road construction at the South Quartzite Ridge Target (SQRT) is set for early 2025 completion. Recent drilling has yielded significant results, particularly at the Northeast Extension Target, where hole AT23NS-177 returned “1.95 [grams per tonne] g/t gold over 29.0m from 227.1m, including 6.60 g/t gold over 6.1m.”

The company’s strategic focus centers on identifying mineralized systems within the Atlanta caldera through districtwide geophysical surveys. Recent infill drilling has validated the company’s geological model, with hole AT23WS-44C demonstrating “3.95 g/t gold over 106.7m from 218.0m, including 9.39 g/t gold over 38.4m.”

Nevada King maintains a stable financial position with CA$0.5 million in cash and no debt. Key risks include political and regulatory challenges, commodity price fluctuations, and operational uncertainties inherent in resource estimation. As a pre-revenue company, access to capital remains crucial for continued development.

The analyst anticipates significant resource expansion potential, noting that “the 2020 mineral resource estimate significantly underestimates the resource potential of the Atlanta Gold Project.” The current resource of 602,000 oz gold could potentially increase to 1.5 million oz, according to the analyst’s speculation.

Based on the share price at the time of the report of CA$0.28, the target price of CA$0.65 represents a 132% potential return.

Important Disclosures:

This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

Disclosures for Roth MKM, Nevada King Gold Corp., December 27, 2024

Regulation Analyst Certification (“Reg AC”): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.

Disclosures: Shares of Nevada King Gold Corp. may be subject to the Securities and Exchange Commission’s Penny Stock Rules, which may set forth sales practice requirements for certain low-priced securities.

ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months. The material, information and facts discussed in this report other than the information regarding ROTH Capital Partners, LLC and its affiliates, are from sources believed to be reliable, but are in no way guaranteed to be complete or accurate. This report should not be used as a complete analysis of the company, industry or security discussed in the report. Additional information is available upon request. This is not, however, an offer or solicitation of the securities discussed. Any opinions or estimates in this report are subject to change without notice. An investment in the stock may involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Additionally, an investment in the stock may involve a high degree of risk and may not be suitable for all investors. No part of this report may be reproduced in any form without the express written permission of ROTH. Copyright 2024. Member: FINRA/SIPC.

( Companies Mentioned: NKGFF:OTCMKTS;NKG:TSX,
)

Gold

Barrick Takes Mali to Arbitration, Situation ‘Untenable’

Post author By Gold News Club
Post date December 31, 2024

Source: Adrian Day 12/27/2024

Global Analyst Adrian Day discusses developments at several companies on his list, some positive, some less so.

Barrick Gold Corp. (ABX:TSX; GOLD:NYSE) has initiated international arbitration against Mali over its dispute over its Loulu-Gounkoto mine. This follows a tough statement in response to recent actions by the military junta, saying that conditions had deteriorated to the point where it may need to suspend operations at the mine.

In particular, the government has blocked shipments of gold, arrested local executives, and issued an arrest warrant for Barrick CEO Mark Bristow. Barrick, calling the situation “untenable,” asserted it had negotiated in good faith with the government. Even though its existing contract was valid, it had made “significant concessions.”

The mine, which represents about 11% of Barrick’s NAV, is also responsible for between 5% and 10% of Mali’s GDP. The likelihood is that Barrick would win its arbitration case, but it may take years before a decision is reached, and it is not certain that the government would honor any ruling. Partly, the move by Barrick is a decision to play hardball since its reasonableness has failed to achieve anything.

Barrick’s stock price has dropped significantly since the dispute came to the fore, from over $21 at the end of October, 25% more than the gold stock indices. That wipes out most of Loulu-Gounkoto’s value. It has the lowest valuations among the larger gold miners, particularly on an NAV basis, but this dispute highlights the company’s higher political risk profile.

More adventurous investors can buy Barrick here.

Franco Buys Another Large Stream, With Political Risk

Franco-Nevada Corp. (FNV:TSX; FNV:NYSE) announced the purchase of a $500 billion gold and platinum stream on production from three of Sibanye-Stillwater’s mines in the Bushveld of South Africa. These are long-life mines; the platinum stream is capped at 294,000 ounces, though the gold is for the life of the mine.

Gold represents about 80% of the stream at current prices. Sibanye said the streams, which are immediately cash flowing to Franco, have an IRR of 4%, though some analysts estimate it significantly higher. Franco intends funding the purchase out of cash on hand, leaving them with approximately $700 million in cash, plus $1 billion undrawn on its credit facility.

Obviously, there is a political risk with this stream purchase, particularly as Franco does not have claims on other Sibanye production should something happen to its South African mines. However, the economics appears attractive due to the dependable and long-life mines.

Mixed Messages From Panama

Separately, First Quantum Minerals Ltd. (FM:TSX; FQM:LSE), owners of the Cobre Panama mine on which Franco holds a stream, reacted to comments from Panamanian President Mulino, who, following a government inspection of the mine site, said he saw no environmental threat from a stockpile of ore that the government has refused to allow FQ to export (and sell). But he ruined the mood when he added that “if” stockpiled ore has to be removed, “there also has to be payment to us, Panama, because it is our material extracted under a concession that no longer exists.”

First Quantum is spending $12 million a month to maintain the closed mine and says that “time is running out” for the government to make an agreement. Franco has written off its stream, so any resumption of the mine would be upside. Before the government ordered the mine closed, the stream represented over 20% of Franco’s revenues. Any restart of the mine, therefore, will have a meaningful impact on the company.

Given the rock-solid balance sheet, the diversified asset base, and the potential upside from a restart of Cobre Panama, Franco is a good Buy here.

Large Altius Royalty Asset Gets Funding Partner

Altius Minerals Corp. (ALS:TSX.V) reported that Nippon Steel had entered into an agreement with Champion Iron Ore for 49% of its Kami project in exchange for up-front payments and a pro-rate share of the development costs. Champion had sought a partner to share in the capex of what promises to be a long-life project. Kami was discovered by Altius, which now holds a 3% gross revenue royalty over the project.

Altius has indicated that its revenue from the royalty could be close to $50 million a year (net of the government royalty tax) once the mine goes into production early in the next decade, making it potentially its largest royalty. Separately, the provinces of Quebec and Newfoundland agreed to proceed with hydro projects aimed at getting power into Labrador for the iron ore projects there.

Two of Kami’s major risks were removed in one week. Altius is a core holding for us, offering exposure to a broad range of resources, a good balance sheet and top management, it has three key assets not fully recognized in its share price — Kami, the Silicon royalty, and the renewables business.

Although you can buy if you do not already own, we are holding off adding to positions following the strong reaction to the Kami news.

Osisko Will Benefit From Agnico Purchase

Osisko Gold Royalties Ltd. (OR:TSX; OR:NYSE) stands to benefit from Agnico Eagle Mines Ltd.’s (AEM:TSX; AEM:NYSE) planned acquisition of O3 Mining Inc. (TSXV:OIII; OTCQX:OIIIF). I should have mentioned this last week, and I appreciate the company pointing it out.

OR holds various royalties over different parts of the Marban project, ranging from 0.5% to 2%. However, it also owns a CA$0.40-tonne royalty on any ore processed in the Canadian Malartic mill but sourced from outside the mine (on which it holds a royalty). This mill royalty, which we have highlighted before, is, I feel, underappreciated in the market and ensures it receives revenue from the Malartic project for many, many years into the future.

Osisko shares have held up far better than the gold stock indices since the late October highs but is a Buy here for the next gold leg up.

Altius Increases Orogen Ownership

Orogen Royalties Inc. (OGN:TSX.V) largest shareholder, Altius Minerals, bought an additional 3.2 million shares in a cross with a wound-up partnership that had to sell its shares. The transaction, at CA$1.35 in early December, brought Altius’ ownership to 19.6%.

Altius and Orogen, recall, each hold separate royalties over AngloGold Ashanti Ltd.’s (AU:NYSE; ANG:JSE; AGG:ASX; AGD:LSE) Silicon Deposit; Orogen has a 1% on the central Expanded Silicon Deposit (which includes the Merlin Deposit), while Altius has a 1.5% royalty over the entire Beaty District, though the extent of their royalty is in arbitration.

This share purchase is a strong sign of confidence. Unfortunately, the transaction, for some reason, was reported as a short by many services. This caused some confusion among shareholders, particularly given that its previous high short interest was less than 50,000 shares. It was an error that has now been sort of corrected, though the reports still show a short of 3.2 million and a subsequent cover. Ignore it. I am not sure what sensible, informed investor would want to be short of Orogen at this point!

Reader J.L. of New York pointed out that last week, I gave the stock price high as
$170 rather than $1.70. He also notes that Orogen trades on the venture
exchange, so the symbol should be “OGN.V.” This is valid, though to me, the
“V” stands for the Vancouver Exchange, which no longer exists and is now the
part of the “TSX Venture,” or Toronto Stock Exchange Venture.

Orogen’s share price has fallen significantly since its peak in late October, but less than many of its peers. There was, apparently, some consistent selling by the partnership referred to above before the cross. The large share volume reported as a short position could have added to the pressure, while the delay in selling the Silicon royalty could have concerned some shareholders who saw their profits disappearing.

In any event, Orogen is a Strong Buy at this price.

Midland Reports Final Lithium Results; More Drilling Ahead

Midland Exploration Inc. (MD:TSX.V) released the final assays from its drill program, in partnership with Rio Tinto Plc (RIO:NYSE; RIO:ASX; RIO:LSE; RTPPF:OTCPK), for lithium on the Galinée project. RTZ is earning into the project with an aggressive exploration program, which included 28 drill holes in 2024.

In a very rich option agreement, Rio can earn 50% of the project over five years by spending $16 million on the project, and cash payments to Midland. It can then earn 70% over the next five years by spending a total of $54 million. These amounts were increased from the terms of the original agreement with the addition of properties.

Drilling is scheduled to resume in March. Midland is well financed, with strong management and a breadth of projects being worked on, both 100% owned and in partnership (alliances, options, and joint ventures) with partners including BHP, Barrick, and Agnico. Midland stock, I feel, has been subject to investor fatigue, waiting for that elusive big discovery, and hit hard by tax-loss selling, taking it to its all-time lows at 0.28 earlier in the week (other than a spike down in August).

It is a Strong Buy here.

Additional Strong Drill Results for Fortuna

Fortuna Silver Mines Inc. (FSM:NYSE; FVI:TSX; FVI:BVL; F4S:FSE) announced new exploration results at Séquéla, one week after updating its resources.

On both the Kingfisher and Sunbird deposits, strike length was extended with good drill results, demonstrating the potential at this mine.

Fortuna is a Buy.

TOP BUYS this week, in addition to above, include Kingsmen Creatives Ltd. (KMEN:SI), Metalla Royalty & Streaming Ltd. (MTA:TSX.V; MTA:NYSE American), and Lara Exploration Ltd. (LRA:TSX.V).

Important Disclosures:

O3 Mining Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Barrick Gold Corp., Franco-Nevada Corp., Altius Minerals Corp., Osisko Gold Royalties Ltd., Agnico Eagle Mines Ltd., Orogen Royalties Inc., Midland Exploration Inc., Fortuna Mining Corp., Metalla Royalty & Streaming, and Lara Exploration Ltd.
Adrian Day: I, or members of my immediate household or family, own securities of: All. My company has a financial relationship with: All. I determined which companies would be included in this article based on my research and understanding of the sector.
Statements and opinions expressed are the opinions of the author and not of Streetwise Reports, Street Smart, or their officers. The author is wholly responsible for the accuracy of the statements. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Any disclosures from the author can be found below. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

Adrian Day Disclosures

Adrian Day’s Global Analyst is distributed for $990 per year by Investment Consultants International, Ltd., P.O. Box 6644, Annapolis, MD 21401. (410) 224-8885. www.AdrianDayGlobalAnalyst.com. Publisher: Adrian Day. Owner: Investment Consultants International, Ltd. Staff may have positions in securities discussed herein. Adrian Day is also President of Global Strategic Management (GSM), a registered investment advisor, and a separate company from this service. In his capacity as GSM president, Adrian Day may be buying or selling for clients securities recommended herein concurrently, before or after recommendations herein, and may be acting for clients in a manner contrary to recommendations herein. This is not a solicitation for GSM. Views herein are the editor’s opinion and not fact. All information is believed to be correct, but its accuracy cannot be guaranteed. The owner and editor are not responsible for errors and omissions. © 2023. Adrian Day’s Global Analyst. Information and advice herein are intended purely for the subscriber’s own account. Under no circumstances may any part of a Global Analyst e-mail be copied or distributed without prior written permission of the editor. Given the nature of this service, we will pursue any violations aggressively.

( Companies Mentioned: ALS:TSX.V,
ABX:TSX; GOLD:NYSE,
FSM:NYSE; FVI:TSX; FVI:BVL; F4S:FSE,
FNV:TSX; FNV:NYSE,
MD:TSX.V,
OGN:TSX.V,
OR:TSX; OR:NYSE,
)