The Monthly Chart

If I have learned anything about investing, it has to be never to doubt the monthly chart. Never doubt what the monthly chart has to say, though it won't help you in the slightest with your emotions.

Now what we have here is a very orderly propagation of the wave. The price progression in the GBN.V monthly chart is unmistakeable, and even holds some right angle references. Both the long term weekly log scale and monthly charts are holding firm with strong concurrence on the wave count.

The monthly chart is the simplest and most straightforward approach, though some of the technical indicators are showing very overbought conditions. I believe that these overbought conditions will be similar to chronically overbought conditions in the gold price chart.

Secondly, the stock price is likely to languish at this level for a couple of weeks until there is a change in the markets themselves.(very possibly there is some news to release with the latest share offering.) This is very probably the last time we see this price level in GBN.V shares.

Most people will have accumulated shares over the years by now and are no longer under water, since we are above the .618% retracement level on the very long term. Many will have bought huge accumulations of shares long before GBN.V development got under way.

A 50% retracement in GBN.V shares of the move from 20.5¢ to 75¢ is 48¢, meaning that a lengthy consolidation is not in order. The last up wave here was nicely chopped up into three and four month segments.

Also of note is that the latest backtest of a pennant breakout formation is a similar time to the (i) upwave corresponding with 29¢. The sell off that has occurred has a very similar cant to the time when Resolute Funds took on a very big chunk of shares and the proceeded to sell in a panic, believing the gold price was crashing. This had no effect whatsoever except to hold off the wave propagation.

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stockcharts.com

$IRX Daily

The discount rate in the U.S. is going through sincere kebobbles as the rate steadily declines to challenge the zero bound once again. The crossing of the zero bound may be perforce a function of pressures on the short term money market, and that negative interest rate swaps or repos will come into vogue.

During the May 6 flash crash, GBN.V shares performed very well, leading me to believe that the same dynamic is in charge here.

supersize: http://www.flickr.com/photos/11747277@N07/5477318283/sizes/l/in/photostream/

stockchart.com

Historical Article

The historical record of the La Ronge gold belt in the Saskatoon paper gives us some of the information that the management of GBN.V would rather keep under wraps. Anybody looking at the other properties neighbouring to the GBN.V properties should carefully read this article and what it has to say. With the addition of the Roy Lloyd mine, there is no reason to look any further at attempting the takeover of the lower grade, smaller prospects.

"Rita Marwald, an SMDC spokesperson, said the Star Lake mine is dwarfed by the Seabee and the Jolu deposits. Seabee has more than one million tonnes grading at .32 ounces of gold per ton, while the Jolu has more than 750,000 tons grading at .74 ounce per ton. Star Lake has grades of gold in the rage of half an ounce per ton, but only reserves of 230,000 tons of ore, which will be mined out in three years."

(note:- Jojay only grades .26 ounces per ton)

"Peter Grummer, vice-president for minerals for Claude Resources, predicted four mines could be in production by 1990, but he would not say which ones.

If things keep happening, gold will be fourth in line (among) Saskatchewan's primary resources by 1990 in terms of value production. That may be four mines producing 250,000 ounces of gold per year. At $500/oz. that would be $125 million per year.

Grummer says the industry at large has misread the potential of Northern Saskatchewan, and is now belatedly getting involved. The original perception was that the La Ronge Gold Belt only hosted small, shallow gold zones, which might not be economic to develop, he said.

However, new principles of exploration have uncovered several zones which go deep into the ground and are much larger than originally thought."

(note:- Bingo, now Roy Lloyd has a strike length larger than Seabee with an en echelon structural duplication and grades three times as much. The technical reports are severely limited in scope and don't provide the information the shareholder needs in order to make a factual comparison. The discovery of Bingo was completely ignored by the market.)

Saskatoon Star Phoenix

My conclusion is that very likely the Mill Zone including the Jolu, Decade, Alimak will be the next development area after RKN/Golden Heart. Very likely the mill zone, like the other deposits in the La Ronge Gold belt will have its own en echelon structural duplication as seems to be the style in the belt.

I presume that the assumptions surrounding the mill zone are that they have one feeder source, and that they are tied together. This is something they have been searching for around the Memorial/Tower Lake deposits for years. But, as John Tosney would say, 'you don't discover without doing.'

To which I would add my own opinion, that this company is run by a bunch of navel gazing geologists in a beard growing competition intent on strangling their favourite puppy.

-F6