Gold Stock Poised to Advance as It Commences Drill Program
Contributed Opinion

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Aztec Minerals Corp. (AZT:TSX.V; AZZTF:OTCQB) is a copper-gold exploration company whose stock is in the latest stages of basing and looking poised to advance, especially as it has just commenced a major drilling program.

Before looking at the latest stock charts, we will overview the company using its new investor deck.

The first slide from the deck provides an overview of the company.

The next slide makes the case for buying Aztec stock on just one page, provided that the timing is right, and as we will see, the latest stock charts suggest that it is.

The company has two big projects, one in southern Arizona and the other south of the border in Northwest Mexico, as shown on the following map.

The following slide shows in more detail where the Tombstone, Arizona project is located and how it is in the heart of a world class porphyry copper district and not far from where Arizona Mining acquired the Hermosa Silver district where it discovered the massive Taylor deposit and got bought out by South32 for $1.8 billion.

Here is what happened to Arizona Mining's stock as a result:

The geology of the Tombstone Project can be reviewed in the investor deck. Here is a summary of the project, which contains the large Contention open pit:

The location and general geography of the Cervantes property in Northwest Mexico can be seen on this slide below.

And again, the geology of the Cervantes project may be reviewed in the same deck. Here is a summary of the property below.

This last slide from the deck shows the capital structure of the company, and it makes clear that a sizeable percentage of the stock is closely held.

To end our look at the fundamentals, it is worth noting that the company will also be using a go-almost-anywhere "tank drill" during its new drilling program, as shown in the following photo.

Turning now to the charts and starting with a 7-month chart, we see that although Aztec hasn't made net progress since we last looked at it on June 10, its technical condition has continued to strengthen. The first point to note is that the disconcerting intraday plunge that occurred on June 21, when it briefly touched 9.5 cents and then went on to close unchanged on the day, was actually a positive development as it left behind a bullish "dragonfly doji" on the chart that signified the final low of the bear market in force from mid-2020 with this rather dramatic candle being followed by a significant change in trading, for as we can see, thereafter upside volume increased markedly driving the Accumulation line quite steeply higher.

This is clearly bullish volume action that should before long translate into an unfolding uptrend. So, after dropping back to test support in the 14 cent area in August and September the price has started higher again and looks like it is set to run to resistance in the 24 – 26 cent zone as an initial objective.

Moving on, we see on the 2-year chart that, following a quite severe decline from March through October last year, the price has marked out what now appears to be a large Double Bottom above a line of support at 14 cents, whose validity as a base pattern is confirmed by the increase in upside volume and the strong uptrend in the Accumulation line since the bottoming candle in June that we considered above.

The duration of this Double Bottom has allowed time for the 200-day moving average to drop down close to the price, putting it in position to quickly turn up in the event that a significant advance gets underway.

Finally we can see on the 9-year chart that the overall pattern that has formed in the stock since Aztec came to market in 2017 is a giant Cup & Handle base pattern, albeit a rather skewed one with a "droopy" Handle and if this interpretation is correct then the potential gains from here are very substantial and very possible given the discovery potential of the company coupled with the stellar outlook for gold as currencies collapse.

This is, therefore, considered to be a very good point to buy or add to positions in Aztec Minerals, which continues to be rated a Strong Buy here.

Aztec Minerals' website.

Aztec Minerals Corp. (AZT:TSX.V; AZZTF:OTCQB) closed for trading at CA$0.175, US$0.1311 on September 30, 2024.