March 31, 2019
Klondike Silver Reports it Achieved its Goal by Finding the Continuation of the Main Lode
Klondike Silver announced by Press Release dated March 26, 2019 that it has completed two diamond drill holes of their 26-hole program. The program was designed to explore the fault off-set of the Main Lode, at the start of the Company’s unexplored “Silver Mile” (1.6 km) section of the Main Lode (vein system).
Both holes have intersected the Main Lode with an average true width of approximately 38.5 meters (126 feet) which is consistent with the average true width of the Silvana portion of the Main Lode.
Klondike’s intersections contain several well brecciated zones containing calcite and siderite veining with sphalerite, pyrite and galena. Assay results are pending. A series of QA/QC samples (i.e. Certified Reference Material, blank and duplicate) have been added to the sample stream at regular intervals. They are being assayed by ActLabs in Kamloops which is an accredited laboratory (ISO/IEC 17025, Lab 790).
The two intersections are similar in appearance to Main Lode drill hole intersections within the Silvana Mine workings. These new intersections are approximately 400 meters West of the old Silvana mine working.
The strike length of the Main Lode has been traced by surface expression over the last 125 years and by the numerous mines located along and within the structure.
There is still room to partake in the Private Placement.
The Klondike Silver Unit Private Placement consists of:
- A share priced @ five (5) cents;
- A Full Warrant attached priced at five (5) cents;
- Importantly, the Full Warrant will be for a period of 5-years.
There is not a Company in the world that has a Full Warrant for 5-years. If a person cannot make money in 5-years with a company like Klondike Silver with its phenomenal assets - - - then I will eat my hat.
I am buying into the Private Placement - - - and so should you!
Gold & the Dow
NY Gold Nearest Futures
The end of the 1st Quarter is todayIf the Martin Armstrong forecast from a couple of years ago is correct Gold will go below $981.50. He has also stated that when it does go above $981.50 again, it will then go very quickly to $5,000 or more.
Please read the David Erfle essay noted below!
Dow Jones Industrials Index Cash
This past week the Dow, the S&P 500 were trading Down and Up while the Nasdaq was Up for most of the week. We Day Traded the S&P500 Futures from both a Long a Short perspective and I and those on whose behalf I Day Trade did quite well.
Has a False Move Lower in Gold Just Begun?
On Friday, March 29, 2019 the following Essay was written by David Erfle whom I have know for over twenty (20) years or more. We both follow Martin Armstrong and we have been to many of Marty’s World Economic Conferences.
Please note, the underlined sentences below are my emphasis.
As we head into a weekly/monthly/quarterly close later today, the distortion of the yield curve in the U.S treasury market has safe-haven capital fleeing into the U.S dollar over gold. In a recent Blog post, global macro economist Martin Armstrong mentioned vast bids for U.S. 90-day T-Bills from around the world having no offers, as emerging markets come under a financial crisis, in part, instigated by Turkey.
Armstrong also stated in the Blog post: “There is a major liquidity crisis brewing that could pop in May 2019. European Banks have loaded their portfolios with real estate loans thanks to quantitative easing and negative interest rates, and emerging market debt.”
Meanwhile, the world’s reserve currency has moved firmly back above its 50-day moving average, despite the Federal Reserve’s abrupt reversal last week towards a much looser long-term monetary policy. Although the strengthening U.S dollar index has served as a headwind at times to the recent uptrend in gold, both have been receiving alternating safe-haven bids.
However, since gold has recently begun to react more negatively to the greenback’s strength, the yellow metal sliced through its 50-day moving average yesterday and could move quickly towards strong support in the $1275-$1280 region soon. Unless this support zone is held next week, critical support at the $1240-$1250 level may come into play quickly.
One reason for expecting this crucial level in the safe haven metal to hold in the coming months, is the continued positive divergence between gold and gold stocks. The recent outperformance of the gold mining stocks vs the gold price has been a good sign, which suggests the metal’s price outlook will remain positive.
Although gold closed well below its critical 50-day moving average yesterday, the global miner ETF has yet to test this crucial support line, or trade lower with panic volume during this corrective move down. The GDX/GLD ratio also remains firmly in its uptrend from last September.
Earlier this week, global miner and sector bellwether Barrick Gold (GOLD) had begun to break out of a year-long reverse head & shoulders basing pattern just below its 200-week moving average. However, as I type this missive, the stock has begun to reverse this move and needs a close today above $14 for the breakout to remain intact.
Barrick, together with the second largest global miner Newmont Mining (NEM), have been leading gold stocks higher since the miner rescinded its below market hostile bid for Newmont and instead, stuck a joint venture deal on their collective Nevada operations earlier this month.
Both of these two mining behemoths combined, make up roughly 20% of GDX holdings. Historically, when the largest miners are leading the gold stocks from multi-year lows, together with the GDX positively diverging from the gold price, a gold bull market is beginning to form.
Although the near-term technical situation in the gold price is becoming bearish, the fundamentals for a new long-term gold bull market are now firmly in place. Moreover, the futures market has priced in a 75% chance of a rate cut in December and even a 25% chance of two rate cuts beginning in September.
Throughout history, the gold price has a propensity for false moves lower, shaking off as many bulls as possible before a strong up-leg can commence. In 2008, we had a similar gold price situation begin to take shape in the global marketplace. Gold had reached major psychological resistance at $1000 just before the global financial crisis began to set in. But the miners back then had already made a huge seven-year run, making them ripe for a profit taking move lower before global margin call selling even started.
Gold stocks initiated its selloff eight months prior to the 2008 stock market crisis, which saw most liquid assets being sold during the global margin call panic, regardless of company specific fundamentals. The gold complex was the first to recover from the crisis with a “V” shaped spike low in September 2008. Leading up to the stock market panic, the gold price cratered over $250 in September after peaking at $1033 in January of the same year. This panic selloff shook out most of the remaining bulls before eventually reversing in sling-shot fashion near month end, eventually trading over $1900 just three years later without a significant correction.
However, the generalist investor view of the gold sector today can arguably be described as apathetic, when compared to the rampant bullishness in the sector leading up to the historic events which took place in 2008. The mining complex has been mired in a bear market for over seven years, while being mostly forgotten by the momentum players who flocked to this sector leading into the financial crisis over a decade ago.
Although we have seen some bifurcation of a few of the best in class juniors and a handful of miners, gold stocks arguably remain the last deep value space in the marketplace. Furthermore, the XAU/Gold ratio shows gold stocks being mired in a 20-year plus bear market in relation to the gold price, despite the huge gold bull market that took place between 2001-2011.
If we indeed begin to see a global financial crisis begin to take shape into the European Parliamentary elections in May, the downside should be limited in gold stocks as long as the $1240-$1250 region is not taken out on a weekly basis in the gold price. While many investors are flocking to the perceived safety of the U.S. dollar, gold should continue to attract enough safe-haven demand to keep the price above this critical support zone.
Meanwhile, the GDX will also need to hold its 200-day moving average just below $21 to spare many of the undervalued and generally ignored gold stocks from possibly revisiting late 2018 lows. It will be beneficial for gold stock speculators to keep a watchful eye on the uptrend in the GDX/GLD ratio above its 200-day line, along with the action of bellwether miners Barrick and Newmont as well.
The abrupt selloff in the gold price this week is telling us more patience will be required for long-suffering resource stock speculators before gold can finally breakout of its nearly six-year basing pattern.
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Points to Ponder
Martin Armstrong: “We have major political turmoil and financial chaos looking ever more serious for May.”
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The material in the “Trading Based on Martin Armstrong Socrates Alerts” and the “Stock and Private Placement” alert letter published by Nick L. Nicolaas is for informational purposes only and is not intended to and does not constitute the rendering of investment advice or the solicitation of an offer to buy securities. The “Trading Based on Socrates” and the “Stock and Private Placement” alert discussion contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (The Act). In particular when used in the preceding discussion the words “plan,” confident that, believe, scheduled, expect, or intend to, and similar conditional expressions are intended to identify forward-looking statements subject to the safe harbor created by the ACT. Such statements are subject to certain risks and uncertainties and actual results could differ materially from those expressed in any of the forward looking statements. Such risks and uncertainties include, but are not limited to future events and financial performance of the company which are inherently uncertain and actual events and / or results may differ materially. In addition we may review investments that are not registered in the U.S. We cannot attest to nor certify the correctness of any information in this note. NLN owns shares in Meadow Bay Gold Corporation, Ashanti Gold Corp; Klondike Silver Corp; Organic Garage; Northern Dynasty Mines; Exeter; Arrowstar Resources, Klondex Mines, Dynasty Gold, and Blue Sky Uranium. Please consult your financial adviser and perform your own due diligence before considering any companies mentioned in this informational bulletin.
March 31, 2019