On March 21, Fed chair Jerome Powell held his maiden post-policy statement press conference. As expected rates went up a quarter-point, and also as expected there was some softness in the gold price leading up to it. Historically, Gold usually rises with interest rates, as increases normally mark rising inflationary pressures, which is the case today. However, for the past year or more, Comex traders use coming news events to move prices. Yesterday we probably witnessed the lows for gold in the coming months.
On this chart of Comex gold, it tested the $1,310 area three times. I expect this support will hold and gold will move back up. First resistance is around $1,340 and the ultimate one that needs to be broken for the bulls to celebrate is $1,370. Like clockwork, gold moved up after the rate increase was announced. Perhaps I should start day trading.
It is important to step back, and that is why I am showing this weekly gold chart, which clearly indicates a longer-term uptrend.
And one final chart: the Playstocks Gold stock short barometer. The big money or smart money is expecting a big rally in gold and gold stocks. The short positions remain near record low levels that have not been registered in the past decade, since I have been tracking it. Back up the truck and load up the gold stocks!This last down-tic in the sector was mostly short sales that have covered.
The hottest exploration area in the 2017 season was northern British Columbia (BC), in the Golden Triangle. We made huge gains with two stocks on our list. Garibaldi, GGI soared from $0.20 to $5 per share, a 2,400% gain. Jaxon Minerals, JAX jumped from $0.07 to $0.40, a 470% gain.
In fact, it was right around this time (March 2017) that I put a finance alert out on Jaxon at $0.07 and soon after on Garibaldi. Spring has just arrived; it is the time of year when the weather and stocks prices start to heat up in the Yukon and northern BC.
I want to add another dandy one in the area to our list this year.
Glacier Lake Resources Inc. (GLI: TSX.V)
Recent price: $0.07
52-week trading range: $0.05 to $0.19
Shares outstanding: 48.5 million
Satvir Dhillon, president & CEO, has 25 years experience in the banking, investment and security business for various public and private companies. He has helped raise over $100 million in capital markets. His previous focus was with U.S. Geothermal Inc. (HTM:NYSE), working there since its early stages on the TSX.V as public company. U.S. Geothermal now operates geothermal power plants and has a market cap over US$100 million.
Pete Parsley, VP Exploration, is a senior geologist with over 32 years' experience in exploration and development in North America, Africa, Asia and South America. He has a master's degree in Geology, and for the past four years has been working with Daniel Kunz & Associates out of Idaho. Directors Stan Szary and Michael Withrow have 55 years combined experience in a variety of roles in public markets, business and financial entities.
Glacier Lake acquired its Silva Vista property in May 2017, and in late 2017 added additional claims in the area for a total of 200 square kilometers. Glacier Lake is pretty much an identical situation as Jaxon and Garibaldi. One end of Glacier's property buts up against Jaxon's property boundary, so in same area. Jaxon's property is shown in pink to the left.
Garibaldi was following up on drilling done by Silver Standard in the 1960s where modern exploration showed Silver Standard missed the target by not going deep enough in the right direction. I highlighted this in my July 28, 2017 update. We now know that modern exploration proved correct and Garibaldi made a discovery.
With Glacier Lake, drilling was done by Equity Silver in 1991/92 with a small, 1,252-meter program. Only one hole went deep enough to hit the target Glacier has defined using more modern exploration techniques. That hole was a very good 2.84 meters that averaged 195.7g/t Ag and 3.65% Cu at a depth of 192.62 meters.
This slide from the presentation shows the model that GLI believes is present at their Silver Vista property, a sedimentary-hosted copper-silver deposit. The red shows the type of flat-lying zone that they expect to hit with drilling, and that showed up in the one Silver Equity drill hole. We should know with the first drill program by Glacier if this model proves correct. Drilling started about three weeks ago.
Extensive geochemistry was completed between 2009 and 2013 that defined soil geochemical anomalies over 2.0 by 1.5 kilometers, with multiple other anomalies (silver, copper, zinc and gold) indicating a large system. In March 2017, GLI completed a VTEM Survey and an initial NI43-101 qualifying report.
What is very interesting is all the recent exploration work shows the two best targets a fair distance from where Silver Equity hit of 195.7g/t silver and 3.65% copper. The Silver Equity target is called MR, or referred to as the Main Showing.
What is also extraordinary are the high soil samples. Outcrop exposure is modest and soil sampling remains an effective tool to define buried targets. Silver values in the soils are enriched and widespread, with more than 37% of the soil samples returning plus 1g/t Ag.
The September surface program on northern part of property (near Jaxon Minerals) identified five new mineralized zones. the highlight sample was 11.60% zinc, 12.60% lead, 16.9 g/t gold and 196 g/t silver.
The VTEM survey lights up the other targets near the main showing. If you headed off the map to the top and left, or northwest, about 22 kilometers up is the new Golden Vista target near the Jaxon Minerals border.
Glacier Lake completed a 1,273-meter diamond drilling program at the Silver Vista project about two weeks ago. The initial drill program was concentrated on the main MR showing, and the purpose was to verify or qualify historic drilling. Two of the historic drill holes ended in mineralization and GLI believes they were not drilled deep enough.
In 2009 and 2012, soil geochemistry outlined a silver-in-soil anomaly approximately 1.5 by two kilometers around the MR prospect area. Six 1991 excavator trenches highlighted an area 100 meters long by 17 meters wide, with three of the trenches intersecting mineralized bedrock.
Drilling in 1991 and 1992 consisted of 14 drill holes totaling 1,252.5 meters and identified a semi-continuous zone 300 meters long by 50 meters wide by three meters to 150 meters deep, with two of the holes ending in mineralization. Key intercepts include:
· MR91-01: 32.87 meters at 0.19% Cu and 34.8 g/t Ag
· MR91-03: 61.91 meters at 0.11% Cu and 40.5 g/t Ag
· MR91-04: 25.9 meters at 0.08% Cu and 62.6 g/t Ag
· MR92-02: 36.58 meters at 0.49% Cu and 26.8 g/t Ag, including 2.84 meters of 3.65% Cu and 195.7 g/t Ag. MR92-02 represents the only deep hole to test this zone, and is a primary drill target for follow-up.
These are historic numbers, so keep caution in mind that they have to be verified, but drilling deeper on this target seems the best place to start, with many other targets waiting in the wings.
From the company's February 26 news release: "It is both exciting and gratifying to reach the important drilling milestone for Glacier Lake. The drill campaign currently under way is expected to be the first of several phases of drilling at Silver Vista," says Saf Dhillon, president and chief executive officer. The company is fully permitted for 10,000 meters of drilling at upward of 40 sites.
This slide from the company presentation gives a good picture and summary of the newly discovered gold target.
Financials
GLI is well funded for the current exploration program. They closed $707,045 on January 2 at $0.06, with almost two-thirds of the cash flow-through at $0.08 per share. They closed another $530,590 on March 19 at $0.06 per share.
Summary
GLI completed drilling two weeks ago and assay labs are not as busy now as later in the season so turnaround time could be soon—by the end of March, or certainly first half of April.
Based on the historic numbers and recent exploration work confirming these targets, I would say the odds of some good drill numbers are very good. When you consider the high quality of the drill targets and no speculation priced into the stock, buying a position now and down at these levels is one of the best drill speculations at this time. And, I might add, it is an early jumpstart to an up-and-coming robust season in the Golden Triangle.
Since inception, other than the first sizzle out of the gate, the stock has mostly been trading between $0.06 and $0.11. You can now buy near the bottom of that range, and with the finance price at $0.06, the downside is small while the upside is tremendous. We witnessed Garibaldi run to $5 last year before any drill results, and Jaxon to $0.40. This is pretty much taking a free shot at a potential for a 10-plus bagger.
Ron Struthers founded Struthers' Resource Stock Report 23 years ago. The report covers senior and junior companies with ample trading liquidity. He started his Millennium Index of dividend stocks in 2003 - $1,000 invested then was worth over $4,000 end of 2014 and the index returned 26.8% in 2016. He retired from IBM after 30 years in customer service, systems and business analyst, also developing his own charting software. He has expertise in junior start-ups and was a co-founder of Paramount Gold and Silver.
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Disclosure:
1) Ron Struthers: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: GLD and Glacier Lake Resources. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company currently has a financial relationship with the following companies mentioned in this article: Glacier Lake Resources is a paid advertiser on playstocks.net. I determined which companies would be included in this article based on my research and understanding of the sector.
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