Morning Briefing: Capitulative Moves in Precious Metals
Welcome to Mining Stock Daily. I’m Trevor Hall.
Today is Monday October 2nd.
Last week gold was pushed into free fall, crashing below the US$1900/oz level, in part because technical-based hedge fund sell algos were triggered when the yellow metal fell below the 200 dma Tuesday. But make no mistake, nearly all of the weekly decline occurred during LBMA and Comex paper trading hours, as the gold price either rose or traded sideways all week during the eastern hemisphere physical trading sessions. The Mining Stock Journal said that the trading action is nearly identical to the price-action in gold and silver in September and October 2008, when gold was pushed as low as possible ahead of the melt-down in the financial system. It added that it believes something similar is occurring now. That said, the lower price of gold has started to stimulate buying by India, which had been somewhat quiet thus far during what is usually its seasonally peak gold-buying time period.
The mining stock newsletter said premiums rose quite a bit in India late last week, indicating that the Indians have started feeding hungrily at the gold trough. Silver was also hammered lower, down $1.20 on the week. The Mining Stock Journal noted that silver closed at a support level that stretches back to March. The mining stocks followed gold and silver lower, as the GDX was pounded down 10% on the week. The Mining Stock Journal said that, given the extremely poor sentiment and freefall nature of the sell-off last week could be indicative of a capitulative bottom.
We will get to the news from the miners and explorers in a moment, but first a word about today’s sponsor.
This episode of Mining Stock Daily is brought to you by… Western Copper and Gold
Western Copper and Gold is focused on developing the world-class Casino project in Canada's Yukon Territory. The Casino project consists of an impressive 11 billion pounds of copper and 21 million ounces of gold in an overall resource. Western Copper and Gold trades on the TSX and the NYSE American with WRN. Be sure to follow the company via their website, www.westerncopperandgold.com.
And here’s what you need to know this morning….
Defiance Silver says new sampling of historic drill core has revealed previously unrecognized zones with high grade and wide widths within the San Acacio project area. Defiance geologists successfully used advances in our deposit and district knowledge to identify and target favourable structural positions and mineralization styles that were overlooked in historic sampling campaigns. Assays of the historic drill core returned 6.83m of 157 g/t AgEq, which also included .35m of 1369 AgEq. Other core returned 36.7m of 162 g/t AgEq and 2.31m of 202 g/t. The updated geologic models and new assays confirm and expand upon the mineralized vein splays and veinlet zones that were identified during recent drilling campaigns. These zones of high-grade silver veinlets and stockwork zones are significant ongoing exploration targets and are actively being incorporated into the deposit model. (TSXV: DEF) (OTCQX: DNCVF) News Release
Horizonte Minerals provided an update on the construction of the Araguaia Nickel Project. The company says it has made progress in the completing the final detailed engineering and construction design. However, along with a comprehensive cost review, the company is redirecting the scope of its design and execution which will increase the overall capital expenditure requirements by at least 35%. To de-risk the operation, the final detailed engineering work has added additional scope items linked to the major equipment packages, made several enhanced design changes from the original engineering study (including changes to the water abstraction pipeline design and water storage reservoir), and has identified the requirement for additional civil works and quantities. Additionally, changes have been required with selected suppliers who have not been able to deliver to the project timeframe, which has added further cost pressures. (TSX:HZM) News Release
Adventus Mining and Salazar Resources says the El Domo - Curipamba copper-gold project has been issued a favourable certificate of No Affect of Water by the Ministry of Environment and water of Ecuador. This important certificate and milestone allows the Participants to construct the planned and designed project infrastructure in an area with the presence of surface and ground water sources. This does not include the water usage permit. That is still progressing, according to the company, along with its Storage and use of explosives, Tailings dam construction and en environmental license permits. The company expects to have these items secured in time for construction in the second quarter of next year. (TSXV: ADZN) (OTCQX: ADVZF) News Release
New Gold also has a mine construction update from its New Afton c-zone Project. The company says they have completed the first draw bell at New Afton's C-Zone and commissioning of the final two of 29 dewatering wells at the New Afton Tailings Storage Facility (NATSF), as planned. C-Zone will now transition to the production ramp-up phase and remains on-track to achieve commercial production in the second half of 2024. C-Zone is the fourth block cave at New Afton, after completion of Lift 1 in 2022 and the currently producing B3 cave. (TSX: NGD) (NYSE: NGD) News Release
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