A good week for gold, which is up 1.04% to ~$US1,940/oz at time of writing.
History shows us war doesn’t usually trigger an extended rally, but news flow – or lack thereof – coming out of Ukraine continues to be the biggest influence on the precious metal.
ASX gold stocks – long thought oversold by gold bulls – have spiked ~19% since hitting recent lows on January 31, to be up 4.7% year-to-date based on the ASX All Ords gold index.
The S&P/ASX All Ordinaries Gold (XGD) index, below, is a benchmark for Australian gold companies.
Gold remains ‘a possum in the headlights’
Gold continues to trade like a possum in the headlights, says OANDA senior market analyst Jeffrey Halley, unable to decide whether it is a wartime haven asset, or grossly overbought and about to correct.
“The net result is it remains running on the spot, albeit not far from recent highs,” he says.
“Gold remains overbought on a technical basis, and is still vulnerable, therefore, to long positions losing their nerves and sparking an aggressive corrective sell-off, with the rally now stalled like a Russian logistics chain.
“Gold looks set to continue trading in a $1920.00 to $1950.00 an ounce range, with major support/resistance at $1880.00 and $1975.00 an ounce respectively.
“Silver’s price action remains constructive ad appears to be forming a bullish pennant formation. Key levels are $24.8500 and $25.6000.”
Winners & Losers
Here’s how ASX-listed gold & silver stocks are performing:
Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop
A good week for gold stocks on the ASX, with 127 up, 68 down, and 48 unchanged.
Producer News
Newcrest Mining (ASX:NCM) jumped almost 2% Friday morning after its partner in the Havieron gold and copper project, Greatland Gold, posted a major resource upgrade to its London shareholders overnight.
Havieron is one of the best gold discoveries in WA in recent years, and the next phase of the company’s long running Telfer hub in WA’s Pilbara.
According to Greatland, 10 months of “consistently impressive drilling results” had underpinned a 53% increase in gold resources to 5.5Moz of gold and 218,000t of copper and 63% increase in indicated mineral resources to 3.1Moz.
Greatland says probable ore reserves at Havieron have also been lifted substantially from 1.7Moz gold equivalent to 2.4Moz of gold and 109,000t of copper or 2.9Moz gold equivalent.
HOWEVER …
“Newcrest has not reviewed or verified the analysis conducted by Greatland Gold,” the ASX gold giant said in a statement.
“Newcrest intends to issue an updated Group Mineral Resources and Ore Reserves statement as at 30 June 2022 with its Full Year Financial Results, which will include a revised Mineral Resource estimate for Havieron.”
BMR hit the bourse with a bang late last year with portfolio of Queensland gold and base metals projects including Dittmer (a historic high-grade goldfield), Ruddygore (a large copper porphyry target) and Ravenswood (a bunch of drill ready targets in a 17moz gold province).
The share price has since drifted badly, but this week’s news could be the positive impetus it needs.
Initial drilling at ‘Seventy Mile Mount’ at Ravenswood has confirmed a “large gold system”, BMR says, with grades improving at depth.
Highlight hits include 40m at 1.06 g/t Au from 47m (including 3m @ 9.38 g/t Au).
This may evolve into another gold deposit like the nearby ‘Mount Leyshon (3.8Moz) and Mount Wright (1Moz), the company says.
The junior explorer hit grades up to 87.5g/t gold at the ‘Dandoko’ project in Mali.
The highlight intercept from the ‘Disse’ prospect – close to the main ~700,000oz resource at ‘Seko’ – was 5m at 19.08g/t gold from 109m including 1m at 87.50g/t.
Very nice.
The results further confirm Disse as an emerging high-grade target with both open cut and underground potential, says OKU MD Simon Taylor.
“The latest high-grade gold result of 5m at 19.08g/t is from the central part of the host structure, which remains open at depth and correlates well with the high-grade gold intersected in the adjacent drill sections, including 6m at 12.56g/t gold and 3m at 19.94g/t gold,” he says.
“The addition of high-grade fresh rock will complement the largely shallow oxide resource at Seko.”
“The current resource expansion drilling program at Seko is now complete with final assay results expected imminently.”
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