How 2018’s gold rush could play out
The gold price has seemingly gone nowhere this year.
On 3rd January 2017 – the first trading day of the year – it finished at $1,151/o and right now, it’s around $1,280; a modest 11% increase.
Hardly anything to start shouting from the rooftops about.
It would seem, then, that even in the midst of political uncertainty and rising interest rates, 2017 has done little to bolster the price of the yellow metal.
Here’s something really weird, though…
While most small cap mining groups saw trivial jumps in value, the share price of some Australian miners went through the roof, with Artemis, De-Grey Mining and DGO Gold all experiencing significant vaults in share price.
So, what happened?
Well, my colleague Sean Keyes has previously talked about ‘the capital cycle’ and its impact on the price of gold mining companies (You can read Sean’s article here).
And while this reinforces the latent potential I believe small gold miners to have – I reckon there’s more to this story than meets the eye.
More than just a false dawn
Shortly before their price hike, Novo Gold believed they were on to something big; early drill results looked promising, showing a significant and the press lapped up the news.
Pretty soon, surrounding gold miners who caught part of the windfall saw their share prices climbing too.
Then came the ‘uh-oh’ moment.
Those share prices began to sink lower. It seemed as though the new twentieth century gold rush prospectors hoped for wouldn’t come from Australia after all
Yet another false dawn, then…
Or was it?
One thing is very clear right now; despite the eventual retraction in price, these Australian companies are worth a lot more than before – a heck of a lot more in fact.
Early investors who stuck around, despite not witnessing the next huge gold rush, would have seen a significant returns.
All in all, far from a disaster.
That said, I believe a new gold rush could still be waiting to be discovered. Why else are people still throwing their money into junior miners?
Indeed, sentiment is still very much in favour of a new gold rush. And it should be.
And this brings me to the opportunity I’d like to share with you today…
You see, a few weeks back, while researching the world’s largest undeveloped reserve, I stumbled upon what could be a huge gold mining opportunity.
It’s on the doorstep of a huge deposit. And recent drill results have got a lot of people very, very excited.
Why the excitement?
Simple. They indicated there could be a much higher grade of gold than previously imagined.
There’s just one catch…
This land is technically owned by someone else.
However, a recent electromagnetic survey indicates the mineralization from this recent find stretches several kilometres on to land that’s been acquired by an industry veteran – and this is what I’m interested in.
Only 60% of the land was acquired because the sellers were so excited about what they may have, they wanted to keep some of the action for themselves, but realized they needed a heavy hitter to get it off the ground. Which is why they brought someone outside in on the project.
They’ve drilled twenty seven holes this summer but only released the results of four. Some of which were pretty decent.
But I, and I’m sure, several others, are waiting with baited breath for the others.