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Walker River Resources (WRR.V)
It has been an impressive summer for gold and has those sell in May crowd wishing they had ignored that market maxim. This year, gold breakthrough a crucial trading level, the $1350 hurdle, that it had struggled to do several times in the past few years. It didn’t just go through it slightly and then give all the gains back, this time it went right through $1400 and stayed above that level. Which is a great sign that we have a new leg in the gold bull market.
What fueled this move is that more investors are starting to realize that the next moves by the Fed will be to lower and put pressure on the USD. This is a very good scenario for gold, silver and other metals.
So far, the big gold stocks have started to join the party, but not as much as you look down the food chain. I maintain that the market has no clue about how weak the supply chain is for gold and silver, and that the most important segment of the sector is exploration.
The junior explorers haven’t really joined the party yet, so there is still time to buy bargains, but that window of opportunity is going to close pretty soon. Even though we are still a long way from a raging bull market for juniors, gold and silver, the extreme cheap valuations won’t be around for much longer.
Seasonally, in late summer, we often see a good buying opportunity that pays off handsomely as we move into the fall and winter. From now until the middle to late part of August bargains can be had. For investors, this year, you don’t want to leave you bargain shopping too late.
Let’s Talk About Some Stocks
A past pick that I featured in the reports at lower valuations is well positioned to take advantage of a stronger market for gold stocks. They have a tight share structure, cheap valuation, a great discovery and a catalyst to unlock shareholder value.
Amex Exploration (AMX.V) has been drilling aggressively basically since I started following it in the report. They have a high-grade gold discovery, in Quebec, which is one of the best mining jurisdictions worldwide. It has been awhile since they last put out drilling results and could drop some good news on the market any time soon.
The way the stock has been trading of late, it looks like the audience for the stock is anticipating good drill results are near. This isn’t out to lunch speculation as they have what looks like could grow into a very large system of high-grade gold. If you don’t already own some of this one, the timing looks very good to take a position.
Another past pick with a very solid stock chart is Walker River Resources (WRR.V) which is also a member of our website sponsorship program. They have an excellent high-grade gold discovery, in Nevada, with the realistic potential of having a large high-grade gold system.
I’m always on the lookout for gold explorers with the potential to deliver something special because the valuations tend to be exceptional. I like to call it the Nevada Premium. Lots of investors follow Nevada gold stocks because it is elephant country where huge deposits are found. It also has the added benefit of easy access and low costs to explore, build mines and mine at a healthy profit.
They have been drilling for awhile now, and we should be seeing results fairly soon. Since I started recommending them, they have had no problems delivering high-grade gold results. This doesn’t look to be based on luck.
If you take into consideration the large geological structures, the past drilling and recent drilling by WRR, it has all the signs of a big, high-grade gold system. In addition it also has a reasonable valuation. With the catalyst of drill results close, this one looks due for a significant breakout.
Back in May, when Great Bear Resources (GBR.V) was trading at around half its current valuation, I made it a pick for a trade. Now that it has doubled, it looks like a good time to take profits and deploy that money elsewhere.
They have doubled very rapidly recently, and doubling from here will be much more challenging and there are other explorers, like the two mentioned earlier that will have a much easier time doubling.
I’m also getting a little concerned about how big their discovery can get. Well at least as it concerns the continuity of the high-grade gold. In Red Lake, the known mines are deep where they have found the extremely profitable zones to mine. It has been on my mind for awhile that management is in no hurry to get deep.
I’m starting to think that their lack of a rush to test the depth potential is because management thinks that it might have limits to the depth potential. Their focus seems to be more on looking for new zones when they already have a classic Red Lake discovery with the depth potential to test. For now, it looks like a good point to take profits and look for other places to put your money.
Things are shaping up for gold and silver to go much higher. Paying attention to quality projects, cheap valuations and catalysts can pay off handsomely in the coming months.
All the best,
Allan Barry Laboucan
Allan Barry Reports
Advance Gold (AAX.V)
P.S. my reports are for information purposes only, before making any investment decisions it is important to do your homework and speak with your financial advisers.