Brien Lundin Commentary – Fri 20 Dec, 2019

A Look At Gold In Q1 2020. Also Comments On Impact Silver

Brien Lundin kicks off today by outlining a couple scenarios he sees for gold in early 2020. In what is typically a good time of the year for gold, the way the metal has bounced into year end is very encouraging. We also get some more insights into Impact Silver and why Brien is recommending this stock again to his subscribers.

Click here to find out more about Brien’s New Orleans Investment Conference.

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Comments:
  1. On December 20, 2019 at 9:08 am,
    Matthew says:

    Brian nailed it across the board and IPT looks ready to move…
    https://stockcharts.com/h-sc/ui?s=IPT.V&p=D&yr=0&mn=9&dy=0&id=p35493648146&a=707614249

    • On December 20, 2019 at 4:37 pm,
      Excelsior says:

      Agreed about Brien’s analysis, as he was spot on for each topic brought up:

      1) Gold and the PM miners have had about 12 out of 14 years where they started to move in late December into the “Q1 Run” Jan & Feb much higher. There are no guarantees in any sector, but the Seasonality pattern has been so ingrained at this point that it becomes a self-fulfilling prophecy. People clear out their old dogs in November & December during tax loss selling, and then all the new positions come in at year-end or to start the year, kicking off the buying frenzy. It is best to position now, before the larger volumes and trend followers jump in.

      2) Yes the recent M&A is a very bullish sign in the sector, the quality low hanging fruit is being gobbled up (Detour, LeaGold, Red Lake Mine) and even the Majors cannibalized one another. That is how it starts….

      3) Yes, the M&A will eventually move down the food chain to smaller producers and the more advanced Developers with economic studies to derisk the purchases of the big boys. Some of the Developers have not really moved very much higher on this recent move higher in Gold, so they are ripe for a takeover. Once newer economic studies come out at $1450-$1500 Gold, then the valuations will need to go much higher and companies that are asleep at the wheel will need to pay up even more for the quality deposits.

      4) Brien was exactly correct about investor psychology being focused on the wrong areas, always wanting the best of the best with the best margins. It is really the marginal to distressed producers, that will see the biggest percentage increases to their economics and margins and will explode higher as prices move up higher. This is especially true with the Silver miners that are going from underwater to finally closing in on profits.

      That isn’t to say the lowest cost producers aren’t also great investments, because look a Silvercorp’s great year as the lowest cost Silver producer. It was a solid investment.

      However, companies like Impact Silver mentioned, or Excellon, or Avino, or Santacruz have so much more room to run when Silver gets up to $19-$21. This was evidenced by (SCZ) Santacruz Silver [one of the highest cost Silver producers] blowing everyone else out of the water in 2019 on the PM surge, where it went up 250% . So many folks in chat rooms were scratching their heads trying to understand why SCZ took off like a scalded cat, but it is because they still don’t grasp this concept of owning the “Best of the Worst”.

      • On December 20, 2019 at 5:13 pm,
        Matthew says:

        You get an A for your summary and BriEn gets my apology for misspelling his name!

        • On December 20, 2019 at 5:16 pm,
          Excelsior says:

          Thanks amigo!

  2. On December 20, 2019 at 9:11 am,
    Dick Tracy says:

    LOL! They should be asking Matthew about Impact Silver, he owns so many shares that he probably sits on The Board. I just couldn’t resist. DT

    • On December 20, 2019 at 9:22 am,
      Matthew says:

      Ha ha, not quite!

  3. On December 20, 2019 at 10:18 am,
    Matthew says:

    I’m still buying Brixton and got filled today at .16 for an average of just over .17 for the last two weeks. I don’t regret digging in early since I would rather buy at a good price and see it go lower than to risk facing a higher price.
    I feel differently when it comes to trading (vs speculating) especially with liquid items like GDX.

  4. On December 20, 2019 at 11:24 am,
    Blue says:

    The question is:
    how big risk is it to Brixton? It has come down a lot and it has 50 million ounces of silver in the bag and a lot of exploration potential. Strong investors like Sprott likes the compsny. So why is speculators afraid to invest?
    Could it be the latest drilling results? Or Brixtons double identity, gold and silver miner. Or could it be as simple as tax loss selling opportunity?
    My gut says buy right now and you will have a 10 bagger when silver gets going.
    Well, now is the time you should buy, when everybody sells of course and be a contrarian.
    Buy and keep it it in the coffee can.
    Matthew I understand your strategi, dont fight the feelings of fear, just do your job and make some money if you believe in precious metals

    • On December 20, 2019 at 11:53 am,
      Matthew says:

      Most of this selling pressure is most likely coming from private placement participants de-risking by selling their shares to take a free ride with their warrants. The $7.7M placement closed August 9 so the “4 month and a day” hold on the new shares ended just 10 days ago. So plenty of share could (and already have) come to market.

      • On December 20, 2019 at 12:49 pm,
        Blue says:

        It could be the de-risking and the free ride Bbb is going through.

      • On December 20, 2019 at 3:26 pm,
        Excelsior says:

        Agreed. The PP participants are blowing out their shares and riding the warrants. We see it all the time when the “free trading” shares come out, but the good news is that on the other side of their selling, other parties (stronger hands) are buying. It’s a good time to go bottom-fishing.

        • On December 20, 2019 at 5:15 pm,
          Matthew says:

          Yes, it creates an unwarranted ugly technical picture and a great opportunity.

    • On December 20, 2019 at 12:16 pm,
      Miklo says:

      The stock had a short term support at 0,19-0,20 and when it broke the chart all of a sudden doesn´t look that great to me. If it doesn´t go back and test 0,19 I Think it will test 0,11-0,12 again. I hope I´m wrong, after all I bought in at 0,19.

      From april 11th to september 19th 2019 we had a similar situation. It broke the support and then support became resistance. In fact, from may to june 2017 and april to september 2018 we saw similar patterns.

      But I guess its like you said, buy when it looks depressed.

      • On December 20, 2019 at 12:59 pm,
        Matthew says:

        No, definitely not a pretty chart but that is common for a lot these tiny juniors at important lows. The private placement selling mentioned above came at the best possible time to scare out weak hands: 1.) after weeks of falling due to a normal correction, and 2.) near the end of tax-loss selling.

        It looked pretty dead just before the 2016 gain of 2,300%…
        https://stockcharts.com/h-sc/ui?s=BBB.V&p=D&st=2015-03-18&en=2016-09-14&id=p79636306763

  5. On December 20, 2019 at 11:57 am,
    Matthew says:
    • On December 20, 2019 at 12:22 pm,
      Miklo says:

      The chart look delightful! I´m glad I bought it.

      Regarding Wallbridge, you said it was at nosebleed levels (0,83). Todays action makes it even more stretched. Eric Sprott had some nice things to say about it today. My gut Felling is that it can be Kirjkland 2.0. Very exiting.

    • On December 20, 2019 at 12:58 pm,
      Blue says:

      What do you think about this Ktn warrant expiring 2021?

      http://canadianwarrants.com/values/current.htm#axzz68gOyL8V5

      • On December 20, 2019 at 1:15 pm,
        Matthew says:

        I agree with that site that it is very overvalued but it probably became overvalued because it looks like such a good bet. If I were to give them a shot, I would dump them near the next intermediate term top. Which probably means sometime before or around mid-2020. Beyond that is way too risky given the time decay that will be accelerating.
        If you get them for a nickel and the shares go to a dollar, you’d have a 10-bagger.

        • On December 20, 2019 at 1:28 pm,
          Blue says:

          Yes! Exactly my thought!
          0.08 cad is a nice buy. Exercise price 0,55 cad
          If Silver goes to 21, Ktn goes at least to 0,55 or higher. It feels like a nice try.

          • On December 20, 2019 at 1:37 pm,
            Matthew says:

            I think KTN will be way beyond .55 at 21 silver.

          • On December 20, 2019 at 3:21 pm,
            Excelsior says:

            There is also the consideration of where these Silver stocks will be at $24 Silver or $28 Silver… because a breakout above the 2016 high of $21.23 will cause a huge impulse leg higher to trigger. This will be similar to what we saw this year when the 2016 high of $1377.50 was taking out definitively to the upside.

          • On December 20, 2019 at 3:22 pm,
            Excelsior says:

            This will be similar to what we saw this year (in Gold) when the 2016 high of $1377.50 was taken out definitively to the upside.

  6. On December 20, 2019 at 12:03 pm,
    Matthew says:
    • On December 20, 2019 at 1:37 pm,
      Matthew says:
      • On December 20, 2019 at 3:12 pm,
        Excelsior says:

        Yes, I’ve noticed that bump in JAG lately. It still has a long way to run to the upside to get re-rated similar to peers doing 80K-100K ounces of Gold production per year, and then from there the ride higher in the precious metals bull market. Lots of fun times ahead.

        • On December 20, 2019 at 5:19 pm,
          Matthew says:

          It might be somewhat less exciting this time due to all the dilution since 2016 but that’s a relative thing. It should do very well as gold goes higher and the hedge book go away.

          • On December 20, 2019 at 6:03 pm,
            Excelsior says:

            Yep, the hedges come off next year. Commence au festival.

    • On December 20, 2019 at 3:01 pm,
      Marty says:

      Eric Sprott, who I believe is a major shareholder in Jaguar, had his comments in ASK THE EXPERTS. end of year rundown yesterday at : Sprott Money.com with Craig Hemke

      • On December 20, 2019 at 5:20 pm,
        Matthew says:

        Thanks for pointing that out.
        I think Sprott invested $17M in JAG this year in addition to his already large stake.

        • On December 21, 2019 at 12:05 am,
          Excelsior says:

          From page 6 of the Jaguar Mining Corporate Presentation – Eric owns 44.6% of JAG

          > Significant JAG Shareholders

          • Eric Sprott (44.6%)
          • Tocqueville Gold Fund (19.6%)
          • Wolverine Asset Management (6.8%)
          • Coast Capital (5.2%)
          • Orrell Capital Management (2.7%)
          • Others (21.1%)

          https://jaguarmining.com/site/assets/files/2343/2019-11-cp.pdf

          • On December 21, 2019 at 12:55 am,
            Excelsior says:

            Ask the Expert – Eric Sprott – Part 1 – December 2019

            December 19, 2019 #AudioInterview

            “Each week on the Weekly Wrap-Up, Eric receives numerous questions about the mining shares. This month, he’s dedicating extra time to answering your questions via our Ask The Expert segment.”

            With that in mind, in Part One of this value-packed edition, Eric tackles the gold miners, answering your questions about a long list of companies, including: AMEX Exploration, Artemis – (3:45), Bonterra -(5:08), Brixton -(6:45), Dynacert, El Dorado, Great Bear -(10:03), Jaguar -(11:35), Kerr, Novo Resources -(13:31), MacDonald Mines, Pacton, Pure Gold -(16:45), Sokoman -(18:06), Wesdome -(19:22), Wallbridge, Balmoral, Kirkland Lake, Teuton, Tudor, Osisko Mining.”

            https://www.sprottmoney.com/Blog/ask-the-expert-eric-sprott-december-2019.html

      • On December 21, 2019 at 12:16 am,
        Excelsior says:

        A Sideways, Low-Volume, Tight Range Week: Is Gold About to Break Out?

        Sprott Money Weekly Wrap-Up (December 20, 2019) #AudioInterview

        With the holidays rapidly approaching, Eric Sprott and host Craig Hemke discuss the year-end price action and look ahead to 2020. In this edition of the Weekly Wrap-Up, you’ll get all the gold and silver news you need, including:

        – What will help silver surge in 2020?
        – How do you know when to sell at either a profit or a loss?
        – Plus: Is tax-loss selling behind us?

        https://www.sprottmoney.com/Blog/a-sideways-low-volume-tight-range-week-is-gold-about-to-break-out-weekly-wrap-up-december-20-2019.html

  7. On December 20, 2019 at 2:10 pm,
    RICHARD/DOC says:

    Technically, there is still downward pressure on BBB. You might be able to pick it up beneath $.15. I’m hoping to take a position there. Big move by EQX the last 1-2 hours of the day with huge volume. IPT looks like it’ll be range bound for awhile.

    • On December 20, 2019 at 2:36 pm,
      Blue says:

      Thanks Doc!

    • On December 20, 2019 at 3:15 pm,
      Excelsior says:

      EQX Equinox has been chugging right along lately, post the news of scooping up Leagold. It has been a very solid Gold developer, into Gold producer, into a Gold mid-tier, and by 2021 it will be a Major producer doing over 1 million ounces per year. What’s not to like? 🙂

      • On December 20, 2019 at 3:26 pm,
        RICHARD/DOC says:

        Couldn’t agree more. The technicals and fundamentals are aligning nicely.

  8. On December 20, 2019 at 3:03 pm,
    RICHARD/DOC says:

    Technically, it looks like the worse is over for MRZ—-nice bump on the daily chart today.

  9. On December 20, 2019 at 3:08 pm,
    Excelsior says:

    A little positive news in the Zinc space today:

    (TK) (TKRFF) Tinka Announces Strategic Investment by Buenaventura

    “Under the terms of the Agreement, Buenaventura will subscribe for 65,843,620 common shares of Tinka at a price of C$0.243 per Common Share for gross proceeds to Tinka of C$16 million. The Issue Price represents a premium of 83% to Tinka’s 3-month VWAP and a premium of 45% to Tinka’s 6-month VWAP, on the TSX Venture Exchange. Upon closing of the Buenaventura Subscription, Buenaventura will become a new insider of Tinka holding approximately 19.9% of the outstanding common shares of the Company on a non-diluted basis.”

    https://ceo.ca/@newswire/tinka-announces-strategic-investment-by-buenaventura

    • On December 20, 2019 at 3:10 pm,
      Excelsior says:

      That is one of the larger premiums to share price average in strategic investment that I’ve seen in a long while:

      “The Issue Price represents a premium of 83% to Tinka’s 3-month VWAP and a premium of 45% to Tinka’s 6-month VWAP”

      • On December 20, 2019 at 4:51 pm,
        Excelsior says:

        A great comment by a contributor over at ceo.ca regarding the Silver targets that Tinka has in addition to the Zinc/Lead deposit.

        @JVandamme – “Wouldn’t be surprised to see the new Buenaventura board member ask the mgmt team to focus more on the latest Silver Zone discovery at Ayawilca & the Colquipucro zone.”

        “After all, BVN started as a silver miner almost 70 years ago at the Julcani mine and BVN is still focused on precious metals.”

        https://ceo.ca/tk?5c201e690976

  10. On December 20, 2019 at 3:09 pm,
    Blue says:

    I did a natgas purchase today. Its in a bottoming process right now and jan and feb should do good to natgas.

  11. On December 20, 2019 at 4:45 pm,
    james says:

    GOLD is the only Money you can’t make up ! <<<you will never SEEEEEEEEEE 1300 $ 1 once in you’re live BUY BUY BUY !!!!!!!

  12. On December 20, 2019 at 11:34 pm,
    Excelsior says:

    Northstar @Northst18363337 on Twitter:

    “This could be it. I’ve been expecting silver to take the lead in the next leg up, with a falling GSR #Gold #Silver #preciousmetals”

    (see the accompanying chart)

    https://twitter.com/Northst18363337/status/1208049999306788864

  13. On December 21, 2019 at 1:03 am,
    Excelsior says:

    Frank Giustra @Frank_Giustra on Twitter:

    “Meanwhile, the mainstream media is absent in its reporting on this ..this recklessness will lead to disaster. It’s like no one reads history books any longer..there is no happy ending #gold”

    Frank Giustra Retweeted Peter Schiff

    “QE4 added $41.6 billion to the Fed’s balance sheet last week, bring the total size to $4.137 trillion. The U.S. now has the most reckless combination of money and fiscal policy ever. If you think the economy was bad during the 1930s or 1970s, wait until you experience the 2020s!”

    https://twitter.com/Frank_Giustra/status/1207823993215971328

  14. On December 21, 2019 at 2:39 am,
    Excelsior says:

    The technical setup for (TML) Treasury Metals looks good for a rise into the Q1 Run and into further metals strength in 2020.

    http://schrts.co/ZfzGzmFg

    • On December 21, 2019 at 2:40 am,
      Excelsior says:

      (TML) (TSRMF) Treasury Metals Commences 15,000 m Drilling Campaign at the Goliath Gold Project

      December 16, 2019

      https://www.treasurymetals.com/news/treasury-metals-commences-15-000-m-drilling-campai-122697/

      • On December 21, 2019 at 2:42 am,
        Excelsior says:

        The upcoming 15,000 meter drilling campaign at Goliath should have a few eyeballs following it’s #exploration success. (TML) Treasure Metals is a solid #Developer that seems under-rated at present, and it would be a great #TakeOver candidate for one of the larger #Producers. Other companies and investors will be watching to see how this next round of drilling will expand the resources and update the potential economics of the project.

        ___________________________________________________________________

        (TML) (TSRMF) Treasure Metals Corporate Presentation:

        https://www.treasurymetals.com/site/assets/files/3945/tml_-_investor_presentation_-_dec_2019.pdf

        • On December 21, 2019 at 2:43 am,
          Excelsior says:

          Treasure = Treasury Metals

      • On December 21, 2019 at 2:48 am,
        Excelsior says:

        TML 15,000 meter drill program:

        “Results from the program will start in January 2020.”

        “At the conclusion of the current program, an updated NI 43-101 Resource Estimate that incorporates all of the new drill results will be completed as part of the Preliminary Feasibility Study.”

        _____________________________________________

        After this resource update and Preliminary Feasibility Study (PFS) are completed we may say a takeover of Treasury Metals as Goliath would make a great bolt-on project for many Producers that need to replace ounces and add to their pipeline of projects.