(Note this weekly posting is a little early as I will not have time during the weekend. But I will add to the same thread, so you can use 'threaded view' to collapse the content)

Daily Chart - Ichimoku

The daily chart is very plain on the results of the latest bear raid on the stock. A concentrated effort to sell inventory in the last two days resulted in a 20% decline while gold prices are at new historic highs.

What the market is attempting to price in with a low of 30¢ is probably a forward-looking factor of 1P/E. This also may imply a gold price well north of $1500/oz. CDN. We saw a break with the down trend which came with some insider buying. Nobody else is buying in this market, as buyers are far and few between.

Sell-side brokers obviously banded together in the last couple of days to attempt to break the stock below trend. But this merely wound up testing the breakout.

supersize: http://www.flickr.com/photos/11747277@N07/6008186717/sizes/l/in/photostream/

stockcharts.com

Stockwatch.com Screenshots

Its obvious what Sell-Side brokers are doing here. They are buying shares at a higher price, accumulating inventory, then selling it for a lower price because of weakness in the bids. At the other side of the trade are the same Sell-Side brokers attempting to settle off as much risk as possible.

This cannot be a well-advised trade in the least. The company has ultimately been secretive about its activities and you cannot rule out that they are in commerical production and will table results. The environmental hurdle has been lowered significantly with the only objection being how constructing a concrete dam on Mallard Lake might affect fish habitat. The tailings impoundment is done-deal. Once the TIA issue is resolved, 700tpd will be the order of the day, and ore from multiple sources is in the cards.

The outcome of a higher gold price leads to mine expansion, the company has been engaged since the end of April in reconfiguring the design of the Roy Lloyd mine, with a further deepening of the adit. And we have already seen a statement that more ore is available to be mined than first thought.

Moreover, the discount rate today is once again challenging the zero bound and probably will see negative again, meaning Sell-Side brokers will not be able to roll over their bet. Again, the gold price is challenging the bearish view on precious metals. Another gold-based financing may also be in the cards, though this might have to wait until spring for a mill upgrade and further development. But by this time, the company may actually be able to pay for its own development entirely on its own.

But, you have to hand it to Sell-Side brokers, they dug in their heels and got their price, for however long it will last. Settlement will be all the more difficult in the face of radically improved fundamentals for the long side.

Frank McGhee - BNN.ca

http://www.bnn.ca/News/2011/8/3/Trader-says-2400-gold-a-possibility.aspx

http://watch.bnn.ca/#clip511234

Don't Look Now, But the $CDN Gold Price Is Through The Roof

@$1600/oz. CDN, GBN.V as a company can literally throw everything and the kitchen sink at their own development and still have a significant portion left over in free cash flow after taxes. Production started at the low in February, and commercial production started in April. The company clearly stands to benefit directly from higher gold prices.

http://www.kitco.com/gold_currency/charts.htm?CAD