With a collapse in the dollar and hyperinflation now inevitable, it is clear that the dollar price of gold will eventually skyrocket, and when I say "eventually" I am not talking about in 5 or 10 years time. It is already starting to accelerate away to the upside and that means that the current dip has presented another buying opportunity, not just in gold itself but in silver and precious metals stocks too.
On gold's latest 13-year chart we can see that the giant Bowl pattern has already driven a breakout to new highs in recent months and in this context the minor reaction of recent weeks is a perfectly normal development that unwinds the overbought condition somewhat and rebalances sentiment. The Bowl pattern can also be described as a Cup, and very often a "Handle" forms to complement the Cup before further significant gains are made, which is a period of consolidation that proportion suggests could last a year or two. Should such a Handle now form it would clearly be a source of major annoyance and frustration to investors in the sector as it would mean their holdings would generally go nowhere for a year or two. However, things are deteriorating at such a rapid rate that it is considered most unlikely that gold would get bogged down in this manner.
The ongoing exponential rise in money creation to support a collapsing economy that has been made worse by the virus hysteria and disproportionate reaction of governments around the world means that the purchasing power of fiat most everywhere will decline at an accelerating rate, and since gold is "real money" that holds its value no matter what, it must therefore gain in price to compensate. What could therefore happen instead is that, rather than meander around for ages making a Handle, the steeply rising Bowl boundary generates a dramatic slingshot move higher in gold, which the current setup certainly makes possible, especially as it has just broken out to new highs. Before leaving the 13-year chart note the strong volume driving the advance up the right side of the Bowl and the strong volume indicators all of which indicates that a major bull market phase has begun, and with the 2011 highs having fallen, there is nothing to stop it. It is also interesting to observe how the freak March plunge, when everything was tanking, was contained and reversed by the Bowl boundary.
On the 3-year chart we can see that, apart from the freak drop in March when everything tanked, gold has advanced within the confines of the parallel channel shown. This channel shows us why gold's advance stopped when it did early in August as it had arrived at the upper channel boundary, and it also makes clear that it is now back in buying territory, although it could dip back again to the $1850 area short term before another major upleg starts, as we will see on its 8-month chart shortly. Only in the event of the stock market dropping hard again, as in March would be likely to see a more serious breach of the lower channel boundary, and that would likely be swiftly reversed as the Fed would quickly come riding to the rescue with trillions of newly created dollars.
On gold's latest 8-month chart we can see that, although it looks pretty well corrected from its early August highs, there is room for a little more reaction back to either of the nearby support levels shown and towards its rising 200-day moving average before the corrective phase is done, which the recent weak minor uptrend channel that formed following the breakdown from the Triangle suggests is quite likely, as it looks like a small bear Flag. If gold does react back as shown on the chart it will be viewed as presenting a "back up the truck" buying opportunity. The bullishly aligned moving averages and strong Accumulation line certainly bode well for the medium and long term.
We are not bothering to look at the COT chart in this update since it is in middling ground, and gives no clear indication one way or the other.
The 8-month chart for GDX shows us that, after a dramatic recovery from its mid-March panic lows to its mid-May peak, stocks have made little net progress since. We can also see on this chart that GDX (and thus precious metals stocks generally) looks pretty well corrected from its early August peak, although as with gold itself, the pattern that has formed over the past several weeks looks like a small bear Flag that may lead to renewed but modest decline probably back into the support above $36 and possibly a little lower towards the 200-day moving average. The earlier overbought condition is already fully unwound and again, moving average alignment is bullish and the Accumulation line is strong relative to price, all of which bodes well for the medium and longer term. Any short-term dip will therefore be viewed as presenting a major buying opportunity. A possible and perhaps probable scenario is shown.
The Gold Miners Bullish % Index has certainly corrected back enough to permit renewed advance, although its reading is still a little on the high side, so another dip in this wouldn't go amiss, such as may be occasioned by the minor drop that the 8-month chart suggests is likely soon.
Finally the dollar index chart concurs with what we are seeing on the gold charts, for as we can see the larger trend is down with moving averages in bearish alignment. However, the mid-September breakout from the trading range has been followed by a small tight downtrend channel that could be a bull Flag—if it is, the dollar could soon make a run towards the resistance shown before rolling over and heading south again, which would be the occasion for the precious metals sector to react back a little more short term as our charts suggest is likely.
Finally, it should be kept in mind that while the near-term scenario set out here is considered likely, it is not "set in stone" because there are so many variables in play over the next several weeks, so it is important to remain flexible and adaptable.
Originally published on CliveMaund.com on October 19, 2020.
Clive Maund has been president of www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years' experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.Sign up for our FREE newsletter at: www.streetwisereports.com/get-news
1) Statements and opinions expressed are the opinions of Clive Maund and not of Streetwise Reports or its officers. Clive Maund is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation. Clive Maund was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
3) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.
Charts provided by the author.
The above represents the opinion and analysis of Mr Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.
Selloff Puts All Eyes on the Fed
Looking for a dovish Fed … the crypto sector suffers another drawdown … will gold ever register a pulse?
Tomorrow, all eyes are on the Fed.
Looking for a dovish Fed … the crypto sector suffers another drawdown … will gold ever register a pulse?
Tomorrow, all eyes are on the Fed.
It’s the most anticipated Fed announcement in recent memory. Investors are expecting hints about the timing and scope of a Fed bond-purchase tapering.
Economists surveyed by Bloomberg expect the November meeting is when we’ll get a formal announcement on the Fed reducing its monthly purchases of $80B of Treasurys and $40B mortgage-backed securities.
Of the 52 economists surveyed, two-thirds expect November. More than half of them believe the taper will begin in December.
But as we noted in yesterday’s Digest, Louis Navellier believes we’ll get more information tomorrow, which will calm markets.
From Louis’ Platinum Growth Club Flash Alert yesterday:
I am expecting a dovish statement.
I am expecting the Fed will clarify that they will begin tapering.
But it’s probably just going to be a mini-taper, not a big one. And so, I think it will be interpreted as dovish, and the market will rally.
***Louis isn’t the only one expecting a dovish Fed
Our hypergrowth expert, Luke Lango, also expects the Fed will tell the market what it wants to hear, resulting in a late-week rebound.
Interestingly, Luke points toward yesterday’s volatility as a clear signal to Federal Reserve Chairman, Jay Powell.
From Luke’s latest update of Hypergrowth Investing:
The Fed is slated to meet today and tomorrow to discuss monetary policy. Many Fed members have voiced a hawkish tone ahead of that meeting, advocating for some tightening via a tapering of asset purchases.
Wall Street is braced for this – investors are largely “OK” with a gradual and smooth taper.
But Wall Street doesn’t want anything more, and they’re letting the Fed know by selling stocks ahead of the meeting, basically saying: “Hey, Fed, if you tighten more aggressively than you’ve signaled, the stock market’s going to collapse, and the whole world is going to blame you.”
It’s a warning shot.
And it’ll work.
Luke believes that today and tomorrow could be choppy in the markets. But tomorrow at 2 p.m. ET, Powell will take the stage. Luke anticipates he will announce a taper, while delivering it in an ultra-dovish tone – pleasing the markets.
That will lead to a market rebound to close out the week.
***If you follow the money-flows, U.S. investors are also expecting this “Wall-Street-friendly” Fed
From Seeking Alpha:
The market is seeing a “monster reallocation cash-to-stocks as tax redistribution threat recedes & Fed expected to remain Wall St-friendly (liquidity easiest since Jul’07),” Michael Hartnett, BofA chief investment strategist, wrote in the “Flow Show” note on Friday.
How big is this reallocation?
Last week, investors dumped cash in favor of stocks at the greatest pace of the entire year. The outflows from money market funds registered $43.5 billion, the biggest of 2021, according to Refinitiv Lipper.
It also marked the largest inflow into U.S. large-cap funds ever. It was $28.3 billion, to be exact. Growth funds saw nearly $7 billion, with small-caps getting $4.2 billion.
So, the results of tomorrow’s FOMC meeting could be a market-mover. We’ll let you know how it goes here in the Digest.
***Stocks aren’t the only asset class in the red recently – the crypto sector has been suffering a sell-off
It feels like bitcoin and the crypto sector had finally begun turning the corner after the 50%+ drop from the spring. That was, until a flash crash from two weeks ago ushered in more weakness.
Yesterday’s multi-asset class selloff hit crypto as well.
Cryptocurrency prices plunged Monday morning during a widespread market sell-off sparked by concerns of a potentially catastrophic debt default in China, pushing many of the world’s largest digital currencies to their lowest levels in more than a month.
The value of the world’s cryptocurrencies plunged to a low of less than $1.9 trillion by 8:45 a.m. EDT on Monday, nearly 11% less than 24 hours prior and reflecting a loss of more than $250 billion, according to crypto-data website CoinMarketCap.
Pullbacks like this are never fun to sit through, but they’re not unusual. So, it’s critical to avoid interpreting “temporary weakness” as a sign of “impending doom.” This is just standard crypto volatility.
Luke, who is also our crypto specialist, echoed this same point in his Saturday update of Ultimate Crypto. And this was before yesterday’s sector weakness.
After highlighting bullish adoption news about several holdings in the Ultimate Crypto portfolio, Luke wrote:
That’s not to say we won’t get a big sell-off here soon. We may.
That’s what cryptos do – from time to time, they plunge.
But it is to say that consumer adoption is progressing at breakneck speed, and consumer adoption will ultimately determine the long-term price trajectory of cryptos.
That’s why we’re more bullish than ever, and why we will be huge buyers on any future plunges in cryptos.
By the way, if you missed it, last week, Luke sat down with fellow crypto expert, Charlie Shrem, to discuss the huge opportunities in the crypto sector.
In short, they believe a new massive crypto bull market is forming, and certain cryptos are likely to go parabolic. Weakness like we’re seeing right now is offering investors greatly-discounted entry prices to top-tier cryptos.
If you’ve been looking for a time to begin a crypto portfolio, this is a good opportunity. To watch the free replay of Luke and Charlie’s event, just click here.
***Meanwhile, even with stocks and cryptos down and anxieties up, gold still can’t catch a bid
There was a time when steep selloffs in stocks and other asset classes would frighten investors, resulting in huge inflows into the “chaos hedge” of gold.
Though that time may return, it’s not here right now.
Yesterday, as all three major stock indexes dropped more than 2%, gold yawned, barely inching higher (and silver actually lost 0.6%).
Our macro specialist and the editor of Investment Report, Eric Fry, put a poetic spin on this…
The yellow metal is barely registering a pulse at the moment. Most of the wax figures inside Madame Tussauds museum seem more vibrant and lifelike.
But the thing about gold is it tends to come back from the grave at the exact moment that dejected investors finally leave it for dead.
Back to Eric:
After gold’s decade-long dormancy from 1991 to 2001, for example, it suddenly sprung to life and soared 500% over the ensuing decade.
More recently, the gold price drifted 40% lower during the seven-year span from 2011 to 2018. But then it revived once again and rallied as much as 70% from its 2018 low.
That rally was probably the first phase of what will become a much bigger move. Now that the gold price has spent more than a year going nowhere, it has gained plenty of rest for its next major move higher.
Frankly, the pessimism has grown so intense that gold is beginning to resemble a dream-trade for a contrarian investor.
Back to Eric to put some numbers on this:
Most folks want little to do with gold at the moment.
On a net basis, investors have withdrawn more than $15 billion from the SPDR Gold Shares ETF (GLD) during the last 12 months. That’s the most rapid and sizable retreat from this gold fund since 2013.
To summarize today’s approximate investor attitudes, they like stocks, adore cryptos, and feel sorry for gold and silver.
“Both metals are suffering from a complete lack of investor interest,” griped Ole Hansen, head of commodity strategy at Saxo Bank A/S, during Thursday’s abrupt selloff.
But remember, there are two macro factors in gold’s corner – inflation and soaring government debt.
Eric notes that the 12-month federal deficit stands at $2.8 trillion…which is a whopping 12.5% of U.S. GDP. Meanwhile, the six-month average U.S. inflation rate is hitting levels not seen in 30 years.
Back to Eric:
Historically, great, big governments deficits, coupled with great, big inflation readings, trigger great, big gold rallies.
Perhaps this time is different. But there’s a reason why many seasoned investors say that “This time is different” is the most expensive phrase in finance.
Because it is…
We’ll keep checking for a pulse here in the Digest and will let you know.
See you back here tomorrow for the post-mortem on the Fed announcement.
Have a good evening,
Jeff Remsburggold silver inflation commodity monetary markets reserve policy metals fed monetary policy crash ax
Here’s Why Evergrande Is NOT the Next Lehman Brothers
Thirteen years ago, on September 15, 2008, Lehman Brothers, one of the largest banks in the U.S., collapsed. The reality is the bank was overleveraged…
Thirteen years ago, on September 15, 2008, Lehman Brothers, one of the largest banks in the U.S., collapsed. The reality is the bank was overleveraged in the real estate market during the housing boom, as it invested in risky real estate and subprime mortgages. When the housing bubble burst, Lehman Brothers didn’t have the cash to cover its loans. As a result, the big bank went bankrupt.Source: Shutterstock
While the “Great Recession” was already underway, it was Lehman Brothers’ mighty fall that was the straw that broke the stock market’s back. Stocks initially chopped around on hopes that the Senate would bail out the big bank, but when they decided not to, stocks were sent into a tailspin. On September 29, 2008, the Dow plummeted 777 points and the S&P plunged 8.8%. At the time, this was both indices’ biggest one-day selloffs in history.
So, when it was announced yesterday that Chinese real estate company Evergrande was on the verge of defaulting on its nearly $300 billion in debt, Wall Street felt a little déjà vu. As a result, investors knee-jerk reacted, causing the Dow to fall as much as 970 points and the S&P 500 to slip 2.9% during intraday trading.
Suffice it to say, it was a bad day for the market, though I must admit I did find it ironic that the financial markets in China and Taiwan were closed while the U.S. markets sold off.
The reality is that China has a debt bubble that’s being pricked. A few weeks ago, its junk bond market was showing some cracks. But is Evergrande China’s Lehman Brothers? And, more importantly, is now the time to sell and sit on the sidelines?
Personally, I don’t think so.
The fact of the matter is Evergrande is too big to fail — and I’m not alone in this thinking. My favorite economist Ed Yardeni commented yesterday morning that the Chinese government is likely to intervene in order to protect the Chinese economy and global markets from the fallout. He noted that Evergrande management is likely to be replaced, and the company will probably be restructured.
Yardeni compared the current Evergrande situation to what occurred in 1998 with Long-Term Capital Management. At that time, the Federal Reserve and other major financial institutions stepped up to protect the U.S. economy — and global economy — from a major collapse when the hedge fund’s leveraged trading strategies failed.
This is why I believe yesterday’s sharp pullback is a prime example of Wall Street’s tendency to “act first” and “think later.” Yes, the Dow’s nearly 1,000-point plunge was gut-wrenching, but I suspect clearer heads will prevail and the stock market will firm up in the upcoming days.
Remember, we have the Federal Open Market Committee (FOMC) statement on Wednesday (I’ll share my thoughts on the FOMC statement in Thursday’s Market360 article, so stay tuned for that!), and I expect the Fed to remain dovish, which should trigger a nice relief rally.
The reality is the Fed has to remain accommodative. As I explained to my Growth Investor subscribers last Friday, in 2020 only 39% of Americans paid income taxes. So, even if the federal government taxes all of us at 100%, the federal budget deficit will still be more than $8 trillion. The federal government has essentially reached the point of no return, and it is following the same path as Japan and Europe. It simply cannot tax its way out of the deficit conundrum. I should also add that the Social Security Trust Fund ran a deficit in 2020 and will be out of money in 2034.
Given the massive federal budget deficit, I don’t expect the Fed to raise key short-term interest rates much higher. We may see the Fed raise the Fed Funds Rate from 0.25% to 0.5% in late 2023 and then to 0.75% in 2024. But rates aren’t likely to go much higher than that. Due to the dire U.S. fiscal situation, the Fed has no choice other than to print money and keep interest rates artificially low.
As a result, the U.S. stock market should remain an oasis in the ultralow interest rate environment. The S&P 500 and Dow continue to yield more than Treasuries and the banks, which is driving yield-hungry investors back to the stock market to high-quality stocks. This is especially great news for my fundamentally superior Growth Investor stocks. During the second-quarter earnings season, my average Growth Investor stock posted a 26.9% second-quarter earnings surprise, and many rallied on their strong results.
Considering this, I am looking forward to the third-quarter earnings season and what it has in store for my Growth Investor stocks. I should add that my Growth Investor stocks are characterized by 46.9% annual sales growth and 57.2% annual earnings growth, and I fully expect them to post wave-after-wave of positive earnings results, which, in turn, should dropkick and drive them higher.
P.S. John F. Kennedy once famously implored us to “ask not what your country can do for you; ask what you can do for your country.”
Now a new generation has turned that statement on its head.
We’ve reached a point of no return.
Our country has been taken over by a gang of folks who would rather take money from us than earn it themselves.
We have become what our forefathers feared:
A nation of takers.
If you’re a believer in financial responsibility and the ideals of the Founding Fathers like George Washington, this should scare you.
If you have any money in savings, in the stock market, in a 401(k) or even cash stuffed under the mattress, this should make the hair on your neck stand up.
I recently recorded a video to explain exactly what’s happening… and why it’s so dangerous to your wealth.
And I’ll share what I’m doing with my money to protect myself. (Hint: It has nothing to do with gold, precious metals or cryptos.)
The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
Louis Navellier, who has been called “one of the most important money managers of our time,” has broken the silence in this shocking “tell all” video… exposing one of the most shocking events in our country’s history… and the one move every American needs to make today.
More From InvestorPlace
Stock Prodigy Who Found NIO at $2… Says Buy THIS Now
Analyst Who Found Microsoft at $0.38 Names #1 Pick for the AI Boom
America’s #1 EV Stock Still Flying Under the Radar
The post Here’s Why Evergrande Is NOT the Next Lehman Brothers appeared first on InvestorPlace.gold markets reserve metals interest rates fed bubble
Vior Prepares To Drill Prospective Belleterre Gold Project; Samples Return Strong Results Up to 274.9g/t Au
Source: The Critical Investor for Streetwise Reports 09/20/2021
The Critical Investor explains why he thinks Vior (TSXV:VIO) has a good risk/reward…
Vior Inc. (TSXV:VIO; FRA:VL51) currently has an attractive project portfolio, a prospective flagship gold project, capital structure and high-quality core investor base for its market capitalization. The stock has consolidated on improving trading volume since February 2021 and is at an attractive entry point for new investors. Based on its current market capitalization, Vior seems to be one of the better risk/reward exploration plays in the sector. Cash and investments at A4M, its outstanding portfolio of projects, the flagship project Belleterre which contains the historic Belleterre Mine (produced 750koz Au @10.7g/t and 95koz Ag between 1936 and 1959) with recent and excellent sampling results (up to 274.9g/t Au), safe jurisdiction (Quebec), strong management team and cornerstone investor base including Osisko Mining Inc. (OSK:TSX) are all arguments that support the investment thesis. It is anticipated that strong drill results, positive gold price movements and potential asset sales/spin-off are potential catalysts which could drive the price higher throughout the balance of 2021.
Investors are encouraged to review the Key Points at the end of this article for a quick snapshot of the company.
Not often do you see a junior explorer consolidating prospective grounds in the backyard of Osisko companies the way Vior Inc. (TSXV:VIO)(FRA:VL51) has. This Montreal based explorer has assembled some impressive property packages, most notably their flagship Belleterre gold project and Skyfall project (on trend with Osisko’s Windfall gold project), both in Quebec. Belleterre has been consolidated into an impressive 291 sq km land package (531 claims), as the company recently negotiated an Option agreement to acquire up to 75% ownership from Osisko Mining Inc. for the last significant piece of the historic Belleterre mining camp. Vior raised CA$2.4M on March 31, 2021, and recently announced strong gold. sampling results at Belleterre. All but one sample contained gold, and 20 out of 38 samples returned gold values above 10g/t Au, with the three highest grade samples coming in at 274.9g/t Au, 121.3g/t Au and 77.4g/t Au. These impressive results validate 10 historic gold showings, and confirm the high exploration potential at Belleterre.
After a month of field exploration at Skyfall, which included till and grab samples, the company is expecting results this Fall. The success of the results will dictate the next steps in the exploration process. Management’s expectations are high and the next phase could include the generation of drill targets. Vior also has an equity investment in Ridgeline Minerals Corp (TSXV:RDG) valued at CA$1.82 million. Ridgeline is exploring 4 highly prospective gold projects in Nevada and plans to spend over CA$5M on exploration in 2021.
There are 72.94M shares outstanding (fully diluted 92.79M), 14.87M warrants (@CA$.15 to CA$0.30 and expiring in July/2022 and March/2023) and several option series to the tune of 4.98M options in total, the majority priced at CA0.10 and CA$0.13 and expiring in 2024 and 2027. Vior has a current market capitalization of CA$15.32M based on the September 17, 2021 share price of CA$0.21.
The current cash position of Vior is approx. CA$2.2M, and the company is looking to raise more soon. The all-in cost of diamond drilling in the lower Abitibi region of Quebec is extremely cheap at approx. CA$160/m. In addition, there are significant tax incentives for Flow Through capital raises dedicated to exploration in Quebec. Vior is looking to raise another CA$1M+ sometime this Fall, as it prepares to commence drilling on their Belleterre project in early November, 2021. Management holds no less than 16% of the current shares outstanding (CEO Fedosiewich holds approx. 10.5%), close strategic holders own approx. 30%, and the company also enjoys approx. 16% institutional ownership (including SIDEX, a Quebec sponsored junior exploration fund, FTQ, the labour sponsored pension fund and 2 other regional Quebec based funds). Osisko Mining owns a 6.7% non-diluted position.
President and CEO Mark Fedosiewich: 35 years of experience in investments and mining. Former First Vice President of CIBC, very extensive business network.
Chairman Claude St-Jaques: Founder of Vior, Mazarin and Virginia Gold Mines, also has a strong network. Very close to the Osisko team.
Executive VP : Laurent Eustache: Professional geologist with 15 years of progressive experience including Agnico-Eagle Mines , Aurizon Gold Mines and as former Portfolio Manager at SIDEX ($100M + AUM)
Vior owns a portfolio of ten projects, however, it’s exploration focus is clearly on the Belleterre and Skyfall projects as mentioned. The Company also views the Ligneris project as a strategic asset in the portfolio as it comprises a near district scale gold rich VMS target and is located near Amex’ Perron project. A disciplined approach and strategy has been deployed to acquire their recent projects, and these need to comply with the following strict criteria:
- Safe and mining-friendly mining jurisdictions
- In close proximity to an existing mine, historic mine or an advanced project
- Good infrastructure nearby and easy accessibility
- Project potential to go from an early to a more advance exploration stage
Nine out of Vior’s 10 projects are located in Quebec, one of the most mining friendly jurisdictions worldwide. Vior also has their early stage Tonya project in Nevada, USA, which is the top ranked jurisdiction according to the Fraser Institute Survey.
The current focus for Vior is clearly locked on their flagship Belleterre property. After consolidating the last and central piece of the puzzle, the company has assembled a district-scale land package with a strike length of 37km:
This land package has never been consolidated on this scale before, is located on a Greenstone Belt with favorable mafic volcanics, includes the historic high grade Belleterre Gold Mine (produced 750koz Au @10.7g/t and 95koz Ag between 1936 and 1959), has good infrastructure and has several gold milling facilities with available capacity nearby, and the entire area is very underexplored ever since. Adding to this, previous drilling did not exceed 250 meters. Notwithstanding this, numerous gold showings have been detected in limited sampling in the recent past (2019). Vior has completed several reconnaissance exploration programs this year, among those an airborne magnetic survey in May, and field work in July and August with the aforementioned, impressive sampling results.
The company has also recently completed a validation of the historical data at and around the former Belleterre Gold Mine which will help in completing their new 3D Model. This compilation and validation work will assist in better defining priority targets for an upcoming 4,000m drill program that will commence in November 2021.
The Belleterre project is, aside from the majority of the claims already 100% owned by Vior, largely subject to 3 Option agreements: with JAG Mines Ltd, 9293-0122 Quebec Inc. and Osisko Mining Inc. The Option with JAG allows Vior to acquire 100% of this specific land package for CA$2.3M in cash and/or shares, and CA$2M in exploration expenditures, over the course of 4 years, with CA$2M of the CA$2.3M in cash or shares scheduled for the last year, representing very little payment obligations until June 31, 2025. JAG holds the equivalent of a 1% NSR over the property.
The purchase option with 9293-0122 Quebec Inc, which covers the Belleterre Gold Mine and its direct surroundings, allows Vior to purchase a 100% interest, by paying CA$2.1M in cash and/or shares before 2023 year end or thereabouts, and with no exploration expenditures. There will be no royalty involved on these claims. This purchase option was arranged during the main consolidation acquisition phase for the Belleterre project, when numerous other claims were acquired from other parties. Most of these parties were granted a 1% NSR, and Globex was granted a 2% gross metal royalty.
The option agreement with Osisko Mining allows Vior to acquire up to 75% of Osisko’s current interest in their Belleterre properties (see above at the map claims Osisko in black). 51% can be acquired by issuing CA$225k in shares over 3 years and by incurring CA$1.25M in exploration expenditures before August 2024. Vior has the right to acquire another 24% by incurring another CA$1.75M in exploration expenditures within 3 years after exercising the 51% option. No royalty is part of this deal, unless the interest of one of the JV partners drops below 10%.
The most impressive feat for me is that Vior managed to consolidate this entire district play right under the nose of Osisko Mining, as Osisko was obviously interested. Maybe Osisko didn’t have the best negotiation position with all the vendors, as a rising gold price and a big name probably drives up prices to the point that Osisko decided to wait, and focus on other projects. A small stake in the project, and an equity stake in Vior might prove to be an interesting alternative for Osisko.
The second most important project for Vior is the Skyfall project, also located in Quebec. This is an equally large land package of 26,758 ha (260.6 sq km), and 100% owned by Vior. It is located adjacent to the East of the Windfall deposit (6M+ oz Au resource, owned by Osisko Mining), and the Gladiator and Barry deposits (combined 2Moz Au resource, owned by Bonterra). Management could consider doing a JV with players in the area which include Osisko and Bonterra. The interesting thing is that this package covers the eastern extension of the Urban-Barry Greenstone Belt, and is very under-explored, due to limited land access until a few years ago. As can be seen, it isn’t directly next door to Windfall but the geologic makeup of the property (Greenstone) combined with the inclusion of a major fault zone and gold showings makes this land package at the very least reasonably prospective for gold exploration.
A till sampling program from March of this year provided lots of gold samples, and on top of this 7 clusters were identified which created lots of enthusiasm with company geologists and management, but unfortunately this type of sampling cannot be translated or extrapolated into g/t Au samples, so there is gold, but how much exactly will have to be verified by standard sampling first. The till sampling results can be seen on the map.
Vior commenced field exploration in May of this year on Skyfall, and completed this program in August. It consisted of prospection, mapping, stripping, channel sampling and more till sampling. The company expects to release results from their Skyfall field program when received this Fall. These results will determine the next phase of exploration which may include drill target generation.
Vior sees their Ligneris project in Quebec as their third priority, and has budgeted CA$250k for exploration expenditures. It was optioned out to Ethos Gold Corp, but they decided to return it to Vior for a compensation of 1M Vior shares (plus 1M full 3 year CA$0.30 warrants, for exploration expenditures incurred) in April of this year, as 2020 drill results did not generate sufficient economic grades, after historic drilling returned impressive results like 13.5g /t Au over 10.5m, 62.1 g/t Au over 2.9m and 5.1g/t Au over 5.9m.
Other projects which will see limited exploration (sampling) this year are Mosseau and Mirabelli (both in Quebec) and Tonya (Nevada, US), of which Mosseau has already seen some drilling in 2017 by Vior, intercepting 2.93g/t Au over 4.5m from 40m and hosting an approx. 40,000 oz Au non-compliant resource.
- Vior seems to be making a fresh start, after advancing several lower-profile projects in the last 5 years. It is now focusing all of its new energy on two impressive district-scale land packages, being Belleterre which surrounds a historic former high grade mine, and Skyfall, which is on trend with a large fault that hosts the Windfall, Gladiator and Barry deposits.
- The company has just recently completed the consolidation of the Belleterre Mine region, by arranging an option agreement with Osisko.
- The region has been very underexplored even though it hosts a historic gold mine and many gold showings. Management believes that there is significant exploration potential at Belleterre. Skyfall is even less explored, but the geological conditions are favorable.
- Vior just announced stellar gold sampling results at Belleterre, with results up to 274.9g/t Au.
- Drilling at Belleterre is about to commence in November 2021, the first results will come out in January 2022. An initial drilling program at Skyfall is likely sometime in 2022.
- Vior is backed by Osisko Mining, and a few powerful Quebec institutions. Adding to this are the CEO and Chairman with their large networks in mining finance, so money will likely not be a problem.
- Vior management is very much aligned with shareholders, as CEO Mark Fedosiewich owns approximately 10.5% of outstanding shares.
- A wildcard for Vior is their early investment in Ridgeline Minerals, which could provide lots of cash in case of a re-rating, potentially caused by exploration success in Nevada.
As with all early stage explorers, chances of success are almost binary. In the case of Vior there are several chances for a discovery, and with Belleterre lots of brownfield exploration could lower the risks considerably. And I wouldn’t underestimate Skyfall or their investment in Ridgeline either. Stay tuned!
Follow progress of Vior here on social media:
This article is also published on www.criticalinvestor.eu. To never miss a thing, please subscribe to my free newsletter, in order to get an email notice of my new articles soon after they are published.
The author is not a registered investment advisor, currently has a long position in Vior and Osisko stock, and Vior Inc. is a sponsoring company through a third party. All facts are to be checked by the reader. For more information go to https://www.vior.ca/ and read the company's profile and official documents on www.sedar.com, also for important risk disclosures. This article is provided for information purposes only, and is not intended to be investment advice of any kind, and all readers are encouraged to do their own due diligence, and talk to their own licensed investment advisors prior to making any investment decisions.
1) The Critical Investor's disclosures are listed above.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Company None. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.
( Companies Mentioned: OSK:TSX, VIO:TSXV; VL51:FRA, )tsx tsxv ax gold diamond tsxv-rdg ridgeline-minerals-corp tsxv-vio vior-inc
This Gas Rally is Reaching Historic Proportions
Gold Price Prediction: Will Fed’s Decision Trigger a Breakout?
Top Silver Stocks To Watch This Week
Skeena Resources Completes $7 Million Financing
Futures Market Speculators Crushed Again
TSX down in every sector amid Canada election & Evergrande crisis
Inca One Gold Posts Record Production Figures For August 2021
O2Gold Shares Rise 7.14% After Reporting Intersects 20.11 g/t Gold Over 0.7 Metres At Aurora
QC Copper Shares Up 25% After Reporting Mineral Resource Estimates of 1.6 Billion Copper Equivalent Pounds For Opemiska Deposit
Teck, Copper Fox peg Schaft Creek cost at US$2.65B
Today’s News24 hours ago
AbraSilver Announces that Rio Tinto has Commenced Drilling at the Arcas Copper-Gold Project in Chile
Economics16 hours ago
Legendary Investor Jim Rogers Warns The “Worst Bear Market Of Our Lifetime” Is Approaching
Precious Metals23 hours ago
Gold Price Prediction: Will Fed’s Decision Trigger a Breakout?
Economics18 hours ago
FOMC To Provide “Advance Notice” For November Tapering; May Deliver Two Potential Hawkish Surprises
Energy & Critical Metals19 hours ago
Mining Stocks Hitting 52-Week Highs This Week
Today’s News21 hours ago
Vertical Exploration Stock Rises 14.81% on Encouraging Initial Sales and Marketing Update
Energy & Critical Metals21 hours ago
#UraniumSqueeze – Prices Continue to Soar as Investors Bet on Higher Demand by Depleting Supplies
Articles23 hours ago
Top Silver Stocks To Watch This Week