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 Show printable version of 'Bottom-Fish Action Report for March 29 to April 4,...' in a New WindowEmail 'Bottom-Fish Action Report for March 29 to April 4,...' to a friendMon Apr 6, 2009
Bottom-Fish Action Report for March 29 to April 4, 2009
    Publisher: Kaiser Research Online
    Author: Copyright 2009 John A Kaiser

 

Bottom-Fish Action Report for Week of March 29 to April 4, 2009

Canada far more attuned to Carbon Jargon than the United States

Last week the TSXV market decided to reverse the positive trend of new highs outnumbering new lows and gainers outnumbering losers, kicking off the week on March 30 with a down day. Instrumental was a growing realization that gold had failed to breach the critical $1,000 mark, and needed to retrench before it could launch a definitive breakout. Last week I pointed out that most of the economic indicators such as unemployment and real estate prices were still in a downtrend, but we have this contrarian signal coming from the general equity markets whose sharp rally some interpret as the market looking ahead of the curve and others dismiss as a sucker's rally. The "Four Bad Bears" chart below puts the current bear market into context by comparing it to the Great Depression prologue of 1929-32, the oil crisis bear market of 1973-74, and the dot-com crash of 2000-2002. Will equity markets resume the downtrend of the 1929 bear market, or will the recent rally continue and break the downtrend?

The short term trends in the gold and copper charts below suggest that perhaps the bullish scenario is evolving where gold is easing because of decreasing concern about the financial crisis, and copper is increasing because the economic turnaround is already underway. The gold downtrend makes sense because the "quantitative easing" now underway has just begun and it is too soon for this new money to create the inflationary pressures whose resurgence ought to spur rising demand for gold. If anything, I would liken the current pullback in gold to what happens ahead of a tsunami where the tide suddenly pulls back, only to rush back with an overwhelming vengeance. We don't know when gold will breach $1,000, but it is just a matter of time, and the more time we have, the better the bottom-fishing window.

The copper uptrend is peculiar because, while there has been significant supply destruction, and one could argue that the Chinese have started to convert the dollars they are receiving for their older treasury notes into hard assets through strategies such as strategic long term stockpiling of copper, all the economic indicators appear set to worsen further, and there is not a corresponding drawdown in LME warehouse inventories. There is some suspicion that hedge funds have re-entered the "hard assets" arena, and quite a few market observers have issued sell recommendations for the copper sector on the premise that copper prices will soon develop a downtrend. Nickel prices have remained near the bottom of their recent range, and while zinc and lead have both crept higher, the gain is nowhere near as dramatic as in the case of copper.

During the weekend I attended Cambridge's Resource and Clean Energy Investment Conference in Calgary where I presented a Workshop on Bottom-Fishing Strategies for the Gold Sector and a Keynote on Exploiting the Bottom-Fishing Window. These links are offered to those of you who caught the presentations and wish to view the slides that accompanied my talks, which, as usual, took me days to prep with charts scavenged from the Internet or constructed from painstakingly compiled data, hours to assemble into a sequence that tells a coherent story, 30 minutes to unleash in a massive free form mind dump, and, an eternity to reproduce in written form, which, of course, is why all you can retrieve is a set of cue cards. Most of the ideas, however, have already been presented to regular readers of the weekly Kaiser Bottom-Fish Action Report, though it never fails to surprise me to see in the audience subscribers who I know read and understand my written word. They probably know that my writing is thinking in action, and are curious to see me speak without thinking, that is, without spending five minutes composing every sentence. There are a few like Bob Lamond who pay for a subscription (God bless him), never read my stuff (may the Devil take him), fall asleep during my speech (thankfully not in the front row where a spasmodically jerking sleepyhead never fails to utterly destroy my train of thought), but who track me down afterwards and ply me with drinks to get the martini enhanced version (the brilliance of which doesn't seem to result in new subscriptions).

The Calgary show was interesting in that only about 60 or so companies were exhibitors, but the crowd was large enough to pack the speaking hall as well as all three speaker workshops. Not so exciting is that despite a pitch about how this is the best bottom-fishing opportunity ever, and how for a $100 trial membership you get an extraordinary insight into what to bottom-fish for, these shows at most produce a handful of trial memberships, half of which are cheque in the mail types with strange names and phone numbers that clearly belong to somebody else when we call to find out why the cheque has not arrived. Too bad for the latter we have the time these days to confirm the cash before activating the membership.

Of course, maybe the Calgary crowd simply did not like my suggestion that the real problem with loading carbon dioxide into the atmosphere to concentrations unprecedented in the past 500,000 years is not "global warming", but "ocean acidification", a process that threatens to destabilize the ocean's food chain and possibly force us to give up on fish and seafood. The significance of the above chart of Antarctica ice core based temperature and atmospheric carbon dioxide levels is that human technology has showed up as an unprecedented global scale actor which has within 200 years unleashed quantities of carbon dioxide that took tens of million years to "sink" into the earth, pushing atmospheric concentrations into an uncharted territory well above that achieved by past processes. The earth may have self-correcting feed back loops which subdue runaway processes, but our problem is that we will only see and understand them after the fact. Meanwhile we have to grapple with extraordinary uncertainty against which the only immediate defense is to ease off on the "gas pedal". The existential choice the world faces is to roll the dice or change the rules, with the only difference between the two being that in the first case we concede that we have no control over our destiny, a popular view among fundamentalists, and in the second case we hope we have control over our destiny, a popular view of humanists.

Although Don Bubar laughed off my concern about ocean acidification as the latest liberal tactic to cope with the cessation of Don Coxe's sunspot activity and the commencement of Jim Letourneau's new cooling trend that has left Calgary encapsulated in crusty snow without a sprouted bud in sight, he did admit a fondness for quality sushi for which tilapia and catfish raised in not-so-fresh water would be a woefully inadequate substitute. And, as with most geologists, if you spot one of those fish symbols on the back of Bubar's car, you better look a little closer or you will miss those cheeky legs sprouting from beneath the fish.

Although jokes were made about calling this a "Clean Energy" conference in fossil fuel Calgary, there was a surprising amount of interest in the two companies, both bottom-fish recommendations (Avalon Rare Metals Inc and Western Lithium Corp), whose upside potential is linked to a growing concern about reducing fossil fuel combustion, or at least slowing down its growth rate. In fact, I had a very strange impressionistic experience that I had sensed earlier when I visited Vancouver in January and Toronto in March, but which was finally hammered home last weekend: Canada is far more into this story of carbon dioxide reduction than the United States.

As a Canadian resident of the United States I have no time to parse the Canadian media scene, limiting myself to media feeds from the United States and other parts of the world which have a bigger population than California, which, of course, excludes Canada. I read a lot of stuff, and because I am on the threshold of being a half century old, I've reached the stage of having to discard old information in order to absorb new information, or adopting compression strategies which strip away detail so that generalities can survive. As somebody who parses a lot of words I develop a sense of relative word abundance, whose order I do not notice until I am exposed to a different tapestry of words. This has in fact happened to me in Canada where I was exposed to domestic newspapers such as the Globe & Mail, television ads, and other word streams which induced in me the sudden insight, "these Canadians are way more into the carbon-based green economy discourse than are Americans, or even Californians". Admittedly this culture shock style observation is not very "quantitative", but it has left me with the sense that while Canadians and Europeans are on board with the green economy movement, the goahead which the world needs to make this a truly momentous trend, still lies in the hands of a recalcitrant United States. Although we hear plenty about Barack Obama as the Green Man, this is not yet part of the American psyche. The useful insight that I returned from Canada with was that this card, which seems to have such obvious implications for giving the ailing American economy a new foundation, has not yet been played.

Above Bottom-Fish Range Within Bottom-Fish Range Below Bottom-Fish Range Recently Closed Out
Updated this Week New 2 Year High New 2 Year Low New Bottom-Fish High New Bottom-Fish Low

Bottom-Fish Recommendations made from March 29 to April 4, 2009
Company Date
Price Recommendation Action Net
Cash
Net
Stock
Gain New Status
No Recommendations

New Comments
Company
Volume High Low Close Chg Status
Peregrine Diamonds Ltd (PGD-T) 163,800 $0.680 $0.610 $0.620 $0.000 BF TP Buy $0.30-$0.49

Bottom-Fish Action Report for March 28, 2009 to April 4, 2009
Peregrine Diamonds Ltd (PGD-T: $0.65)
RSProfileSearchWebTreeForumSEDARQuoteIPV

Bottom-Fish Comment - April 1, 2009: Is Peregrine dealing with a new unexplored craton?

Peregrine Diamonds Ltd has published some new graphics which help one appreciate the scale of the combined Chidliak and Qilaq diamond project on south Baffin Island and which open the intriguing possibility that Peregrine is dealing with a brand new, largely unexplored craton. I have plucked a couple slides from recent Peregrine presentations and reproduced them below in the hope it will encourage bottom-fishers and spec value hunters who have accumulated the stock on my recommendation since late August 2008 to hold out for a "big score" rivalling the one Eric's brother Robert made in 1994 while looking for diamonds in Labrador's Nain Province. Jennifer Pell introduced the slide below in her PDAC talk on Chidliak during the Diamond Technical Session with the speculative suggestion that the Archean craton covered by Chidliak and Qilaq may have been part of the "North Atlantic Craton" which underlies the ice sheet covered southern part of Greenland. The possibility that Labrador's Nain Province was part of Greenland before rifting apart has been bandied about for decades, but the possibility that the ground now owned by Peregrine on Baffin Island is a fragment once also attached to the North Atlantic Craton is a more recent item of discussion in academic circles. Being once attached to Greenland is not, of course, a great pedigree in diamond circles, because Greenland does not boast any commercial diamond deposits. In fact, until Hudson Resources Inc recovered commercial sized gem diamonds from its Garnet Lake dyke in early 2007, Greenland was only known for a few micro diamonds recovered from kimberlite dykes that occur along the southwestern coast of Greenland where exposed rock extends inland at most 150 km before disappearing under the ice sheet. The significance of the theory that Chidliak-Qilaq is part of the North Atlantic Craton lies more in the suggestion that it is neither part of the Superior Craton to the southwest in northern Quebec where nothing of interest has so far been found, nor is it part of the Rae and Hearne Cratons of the Churchill Province where commercial sized diamonds have been recovered by Stornoway, Shear and Twin on their Aviat, Churchill and Freighttrain projects but with insufficient tonnage to allow commercial development.

The Rae and Hearne as well as the western part of the Superior craton have been viewed with suspicion by the diamond exploration sector because of the Trans Hudson Orogeny 2.0-1.8 billion years ago which sutured these "micro-continents" together, creating a thermal history that may have run afoul of Clifford's Rule that economic diamond deposits occur only on a craton which has been cool and stable since Archean times. This rule does occasionally get violated because it only applies to peridotitic diamonds formed more than 2.5 billion years ago; the diamonds which make pipes such as Orapa and Jwaneng world class are younger eclogitic diamonds presumed to have been formed from ocean bottom carbonates subducted under cratons through a process called "underplating". The counter-intuitive result is that when a kimberlitic magma begins its ascent it picks up the younger diamonds first and the older diamonds later. The best of all worlds occurs when the diamond stability field within a craton has remained intact since Archean times, preserving the older diamonds, and has been fed with carbon bearing material from which eclogitic diamonds formed once it entered the diamond stability field. Peregrine does not yet know the age of the CH1 kimberlite at Chidliak which has yielded large gem quality diamonds from very small samples, but it has found carbonate fragments within pyroclastic material recovered from CH1. No carbonate platform remains on the Chidliak-Qilaq property, but an Ordovician aged (505-438 million years) cover rock exists in the western part of south Baffin Island, leading Peregrine to speculate that the Chidliak pipes are younger than Ordovician. The breakup of Baffin Island from Greenland did not begin until early Cretaceous (144 million onwards), and whether or not that had anything to do with the emplacement of kimberlites is unknown. But what is interesting is the idea that the Archean fragment on which Chidliak-Qilaq sits may have sat in quiet isolation for more than 2 billion years far away from the deformational events that wreaked havoc on the Churchill Province. And that is where the second slide comes in handy, because it super-imposes onto the Chidliak-Qilaq project the central part of the Slave Craton which hosts the Cretaceous aged Ekati and Cambrian aged Gahcho Kue kimberlite clusters and which encompasses the currently known economic diamond potential of the Slave Craton. I find this slide intriguing because I initially did envision Chidliak-Qilaq as this little thing attached to the edge of Baffin Island whereas Ekati et al was this giant region in the middle of the Northwest Territories. This graphic does help me realize that Chidliak-Qilaq has a comparable scale, and when I consider that it is not at all the magmatically interrupted outer limit of the Rae Craton, it does allow me a flicker of hope that perhaps its bounty can exceed that of the Slave Craton which eluded everybody until 1991 and not because nobody bothered to look. The scientists will be arguing about the orgin of the Archean Chidliak-Qilaq fragment for a long time; what seems to be relevant for now to Peregrine bottom-fishers and speculators is that Chidliak-Qilaq is something brand new and not just a stretch of the imagination.


New Bottom-Fish Highs
Company
Volume High Low Close Chg Status
Amanta Resources Ltd (AMH-V) 216,900 $0.075 $0.060 $0.070 $0.000 BF XP Buy below $0.10
Atacama Minerals Corp (AAM-V) 282,000 $0.450 $0.360 $0.370 $0.000 BF LP Buy $0.20-$0.29
Benton Resources Corp (BTC-V) 829,200 $0.360 $0.245 $0.320 $0.055 BF MP Buy $0.10-$0.19
Brazauro Resources Corp (BZO-V) 1,491,000 $0.590 $0.465 $0.550 $0.070 BF TP Buy $0.20-$0.29
Calibre Mining Corp (CXB-V) 257,900 $0.090 $0.070 $0.085 $0.025 BF XP Buy below $0.10
Dome Ventures Corp (DV.U-V) 42,000 $0.210 $0.180 $0.190 $0.020 BF MP Buy $0.10-$0.19
Graniz Mondal Inc (GRA.H-V) 222,400 $0.200 $0.100 $0.190 $0.130 BF XP Buy below $0.10
Linear Gold Corp (LRR-T) 366,800 $1.330 $1.080 $1.210 $0.090 BF TP Buy $0.50-$0.75
MDN Inc (MDN-T) 2,089,300 $0.780 $0.550 $0.680 $0.100 BF TP Buy $0.50-$0.75
Orko Silver Corp (OK-V) 3,113,000 $1.120 $0.910 $1.000 $0.000 BF TP Buy $0.30-$0.49
Red Dragon Resources Corp (DRA-V) 932,000 $0.185 $0.135 $0.185 $0.055 BF XP Buy below $0.10
Underworld Resources Inc (UW-V) 732,200 $0.650 $0.485 $0.650 $0.130 BF MP Buy $0.10-$0.19
Wesdome Gold Mines Ltd (WDO-T) 374,500 $1.590 $1.400 $1.400 ($0.030) BF TP Buy $0.76-$1.00

Top 10 Bottom-Fish Volume Traders
Company
Volume High Low Close Chg Status
B2Gold Corp (BTO-T) 4,255,400 $0.730 $0.540 $0.670 $0.060 BF TP Buy $0.30-$0.49
Motapa Diamonds Inc (MTP-V) 3,882,000 $0.300 $0.240 $0.240 ($0.060) BF MP Buy $.10-$0.19
Orko Silver Corp (OK-V) 3,113,000 $1.120 $0.910 $1.000 $0.000 BF TP Buy $0.30-$0.49
MDN Inc (MDN-T) 2,089,300 $0.780 $0.550 $0.680 $0.100 BF TP Buy $0.50-$0.75
Western Lithium Canada Corp (WLC-V) 1,786,100 $0.840 $0.530 $0.780 $0.240 BF MP Buy $0.10-$0.19
Grayd Resource Corp (GYD-V) 1,625,600 $0.450 $0.300 $0.300 ($0.150) Spec Cycle Hold 100%
Brazauro Resources Corp (BZO-V) 1,491,000 $0.590 $0.465 $0.550 $0.070 BF TP Buy $0.20-$0.29
Ur-Energy Inc (URE-T) 1,340,400 $0.750 $0.630 $0.720 $0.050 BF MP Buy $0.50-$0.75
VMS Ventures Inc (VMS-V) 1,137,500 $0.295 $0.260 $0.270 ($0.020) BF MP Buy $0.20-$0.29
Skygold Ventures Ltd (SKV-V) 968,200 $0.200 $0.170 $0.185 $0.005 BF MP Buy $0.20-$0.29

Top 10 Bottom-Fish Value Traders
Company
Value High Low Close Chg Status
Orko Silver Corp (OK-V) $3,127,434 $1.120 $0.910 $1.000 $0.000 BF TP Buy $0.30-$0.49
B2Gold Corp (BTO-T) $2,765,983 $0.730 $0.540 $0.670 $0.060 BF TP Buy $0.30-$0.49
MDN Inc (MDN-T) $1,428,615 $0.780 $0.550 $0.680 $0.100 BF TP Buy $0.50-$0.75
Western Lithium Canada Corp (WLC-V) $1,222,406 $0.840 $0.530 $0.780 $0.240 BF MP Buy $0.10-$0.19
Nevsun Resources Ltd (NSU-T) $1,213,089 $1.500 $1.250 $1.270 ($0.170) Spec Cycle Hold 100%
Motapa Diamonds Inc (MTP-V) $972,700 $0.300 $0.240 $0.240 ($0.060) BF MP Buy $.10-$0.19
Ur-Energy Inc (URE-T) $916,930 $0.750 $0.630 $0.720 $0.050 BF MP Buy $0.50-$0.75
Brazauro Resources Corp (BZO-V) $785,544 $0.590 $0.465 $0.550 $0.070 BF TP Buy $0.20-$0.29
Grayd Resource Corp (GYD-V) $575,560 $0.450 $0.300 $0.300 ($0.150) Spec Cycle Hold 100%
Wesdome Gold Mines Ltd (WDO-T) $562,555 $1.590 $1.400 $1.400 ($0.030) BF TP Buy $0.76-$1.00

Top 10 Bottom-Fish Price Gainers
Company
Volume High Low Close Chg Status
Western Lithium Canada Corp (WLC-V) 1,786,100 $0.840 $0.530 $0.780 $0.240 BF MP Buy $0.10-$0.19
Graniz Mondal Inc (GRA.H-V) 222,400 $0.200 $0.100 $0.190 $0.130 BF XP Buy below $0.10
Underworld Resources Inc (UW-V) 732,200 $0.650 $0.485 $0.650 $0.130 BF MP Buy $0.10-$0.19
Western Uranium Corp (WUC-V) 305,500 $0.790 $0.640 $0.790 $0.120 BF MP But $0.50-$0.75
Metallic Ventures Gold Inc (MVG-T) 34,100 $0.690 $0.610 $0.690 $0.110 BF MP Buy $0.30-$0.49
MDN Inc (MDN-T) 2,089,300 $0.780 $0.550 $0.680 $0.100 BF TP Buy $0.50-$0.75
Salazar Resources Ltd (SRL-V) 15,500 $0.425 $0.310 $0.425 $0.095 BF MP Buy $0.10-$0.19
Linear Gold Corp (LRR-T) 366,800 $1.330 $1.080 $1.210 $0.090 BF TP Buy $0.50-$0.75
Vulcan Minerals Inc (VUL-V) 111,500 $0.400 $0.300 $0.400 $0.085 BF MP Buy $0.30-$0.49
Brazauro Resources Corp (BZO-V) 1,491,000 $0.590 $0.465 $0.550 $0.070 BF TP Buy $0.20-$0.29

Top 10 Bottom-Fish Price Percentage Gainers
Company
Volume High Low Close Chg Status
Graniz Mondal Inc (GRA.H-V) 222,400 $0.200 $0.100 $0.190 217% BF XP Buy below $0.10
African Aura Resources Ltd (AAZ-V) 15,000 $0.100 $0.095 $0.100 54% BF XP Buy below $0.10
Western Lithium Canada Corp (WLC-V) 1,786,100 $0.840 $0.530 $0.780 44% BF MP Buy $0.10-$0.19
Red Dragon Resources Corp (DRA-V) 932,000 $0.185 $0.135 $0.185 42% BF XP Buy below $0.10
Calibre Mining Corp (CXB-V) 257,900 $0.090 $0.070 $0.085 42% BF XP Buy below $0.10
Boss Power Corp (BPU-V) 2,000 $0.090 $0.090 $0.090 38% BF XP Buy below $0.10
Uravan Minerals Inc (UVN-V) 1,500 $0.160 $0.160 $0.160 33% BF MP Buy $0.10-$0.19
Salazar Resources Ltd (SRL-V) 15,500 $0.425 $0.310 $0.425 29% BF MP Buy $0.10-$0.19
Nevada Exploration Inc (NGE-V) 357,300 $0.075 $0.045 $0.070 27% BF XP Buy below $0.10
Vulcan Minerals Inc (VUL-V) 111,500 $0.400 $0.300 $0.400 27% BF MP Buy $0.30-$0.49

Top 10 Bottom-Fish Price Losers
Company
Volume High Low Close Chg Status
Antares Minerals Inc (ANM-V) 275,100 $1.700 $1.220 $1.350 ($0.350) BF MP Buy $0.50-$0.75
Kootenay Gold Inc (KTN-V) 170,900 $0.830 $0.600 $0.600 ($0.200) BF MP Buy $0.30-$0.49
Nevsun Resources Ltd (NSU-T) 876,200 $1.500 $1.250 $1.270 ($0.170) Spec Cycle Hold 100%
Grayd Resource Corp (GYD-V) 1,625,600 $0.450 $0.300 $0.300 ($0.150) Spec Cycle Hold 100%
Troon Ventures Ltd (TVN-V) 88,000 $0.810 $0.790 $0.800 ($0.100) Spec Cycle Hold 100%
Gleichen Resources Ltd (GRL-V) 95,500 $0.410 $0.340 $0.410 ($0.080) BF LP Buy $0.10-$0.19
U3O8 Corp (UWE-V) 94,400 $0.345 $0.300 $0.320 ($0.080) BF LP Buy $0.20-$0.29
Uranerz Energy Corp (URZ-T) 7,500 $0.710 $0.650 $0.650 ($0.080) BF MP Buy $0.50-$0.75
Esperanza Silver Corp (EPZ-V) 66,500 $0.700 $0.660 $0.660 ($0.070) BF TP Buy $0.50-$0.75
Brett Resources Inc (BBR-V) 556,300 $0.720 $0.600 $0.610 ($0.060) BF TP Buy $0.50-$0.75

Top 10 Bottom-Fish Price Percentage Losers
Company
Volume High Low Close Chg Status
Grayd Resource Corp (GYD-V) 1,625,600 $0.450 $0.300 $0.300 -33% Spec Cycle Hold 100%
Soltoro Ltd (SOL-V) 25,000 $0.060 $0.060 $0.060 -29% BF XP Buy below $0.10
Kootenay Gold Inc (KTN-V) 170,900 $0.830 $0.600 $0.600 -25% BF MP Buy $0.30-$0.49
Cartier Resources Inc (ECR-V) 20,000 $0.200 $0.180 $0.180 -23% BF MP Buy $0.20-$0-0.29
Western Troy Capital Res Inc (WRY-V) 4,000 $0.095 $0.095 $0.095 -21% BF TP Buy $0.30-$0.49
Antares Minerals Inc (ANM-V) 275,100 $1.700 $1.220 $1.350 -21% BF MP Buy $0.50-$0.75
U3O8 Corp (UWE-V) 94,400 $0.345 $0.300 $0.320 -20% BF LP Buy $0.20-$0.29
Motapa Diamonds Inc (MTP-V) 3,882,000 $0.300 $0.240 $0.240 -20% BF MP Buy $.10-$0.19
Sennen Resources Inc (SN-V) 27,100 $0.190 $0.175 $0.175 -17% BF TP Buy $0.10-$0.19
Galena Capital Corp (FYI-V) 14,000 $0.130 $0.115 $0.125 -17% BF XP Buy below $0.10

New Bottom-Fish Lows
Company
Volume High Low Close Chg Status
No Records

 
 

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